Document of
The World Bank
FOR OFFICIAL USE ONLY
Report No: 54504-UG
PROJECT APPRAISAL DOCUMENT
ON A
PROPOSED CREDIT
IN THE AMOUNT OF SDR 79.5 MILLION
(US$120.0 MILLION EQUIVALENT)
AND A
PROPOSED GRANT FROM THE
GLOBAL ENVIRONMENT FACILITY TRUST FUND
IN THE AMOUNT OF US$7.2 MILLION
TO THE
THE REPUBLIC OF UGANDA
FOR AN
AGRICULTURAL TECHNOLOGY AND AGRIBUSINESS ADVISORY SERVICES
PROJECT
May 26, 2010
Agriculture and Rural Development
Sustainable Development Department
Country Department 1
Africa Region
This document has a restricted distribution and may be used by recipients only in the
performance of their official duties. Its contents may not otherwise be disclosed without World
Bank authorization.
CURRENCY EQUIVALENTS
(Exchange Rate Effective May 11, 2010)
Currency Unit = Uganda Shilling
UShs 2,081 = US$ 1
US$ 1 = SDR 0.66
FISCAL YEAR
July 1 ­ June 30
ABBREVIATIONS AND ACRONYMS
AASP Agriculture Advisory Service Provider
APEP Agricultural Productivity Enhancement Program
APL Adaptable Program Loan
ARSP Agricultural Research Service Provider
ARTP Agricultural Research and Training Project
AR4D Agricultural Research for Development
ASARECA Association for Strengthening Agricultural Research in Eastern and Central Africa
ASPS Agriculture Sector Program Support
ASWG Agricultural Sector Working Group
ATAAS Agricultural Technology and Agribusiness Advisory Services Project
BDSP Business Development Service Provider
CAO Chief Administrative Officer
CAADP Comprehensive African Agricultural Development Program
CBF Community Based Facilitator
CCF Commercialization Challenge Fund
CDO Community Development Officer
CRG Competitive Research Grant
CGIAR Consultative Group on International Agricultural Research
CIO Chief Information Officer
CSO Civil Society Organization
DA Designated Account
Danida Danish International Development Assistance
DARST District Adaptive Research Support Team
DfiD U.K. Department for International Development
DP Development Partner
DPO District Production Officer
DSIP Development Strategy and Investment Plan
EAAPP East African Agricultural Productivity Program
ERR Economic Rate of Return
ESMF Environmental and Social Management Framework
EU European Union
FAO Food and Agriculture Organization of the United Nations
FEW Frontline Extension Worker
FID Farmer Institutional Development
FINMAP Financial Management Accountability Program
FM Financial Management
ii
FY Financial Year
GAC Governance and Anti-Corruption
GDP Gross Domestic Product
GEF Global Environment Facility
GEO Global Environmental Objective
GoU Government of Uganda
GP Group Promoter
HLFO Higher-Level Farmer Organization
IAR4D Integrated Agricultural Research for Development
ICB International Competitive Bidding
ICRA International Centre for Research in Agricultural Development
ICT Information and Communications Technology
IDA International Development Association
IFAD International Fund for Agricultural Development
IFPRI International Food Policy Research Institute
IFR Interim Financial Report
IGG Inspector General of Government
IRR Internal rate of return
LG Local Government
LGDP Local Government Development Program
MAAIF Ministry of Agriculture, Animal Industry, and Fisheries
MC Management Committee
M&E Monitoring and Evaluation
MFI Microfinance Institution
MoFPED Ministry of Finance, Planning, and Economic Development
MIS Management Information System
MoLG Ministry of Local Government
MoU Memorandum of Understanding
MSIP Multi-Stakeholder Innovation Platform
MTEF Medium-Term Expenditure Framework
MTR Mid-Term Review
NAADS National Agricultural Advisory Services
NARI National Agricultural Research Institute
NARO National Agricultural Research Organization
NARP National Agricultural Research Program
NARS National Agricultural Research System
NCB National Competitive Bidding
NDP National Development Plan
NEPAD New Partnership for African Development
NGO Non-governmental organization
NRM Natural Resource Management
PARI Public Agricultural Research Institute
PDO Project Development Objective
PER Public Expenditure Review
PP Procurement Plan
PPDA Public Procurement and Disposal of Assets/Authority
PPF Project Preparation Facility
PPP Public­Private Partnership
PRSC Poverty Reduction Support Credit
RCoE Regional Center of Excellence
R&D Research and Development
iii
R&E Research and Extension
SACCO Savings and Credit Cooperatives
SIP GEF Strategic Investment Program for Sustainable Land Management
SLM Sustainable land management
SMS Subject Matter Specialist
SNV Netherlands Development Organization
SOE Statement of Expenditure
SWAp Sector Wide Approach
TFP Total Factor Productivity
UBOS Uganda Bureau of Statistics
UCSCU Uganda Cooperative Savings and Credit Union
USAID United States Agency for International Development
US$ United States dollar
UShs Uganda Shilling
ZARDI Zonal Agricultural Research and Development Institute
Vice President: Obiageli Katryn Ezekwesili
Country Director: John Murray McIntire
Sector Manager: Karen McConnell Brooks
Task Team Leader: Madhur Gautam
Co-Task Team Leader: Sergiy Zorya
iv
UGANDA
Agricultural Technology and Agribusiness Advisory Services Project
CONTENTS
I. STRATEGIC CONTEXT AND RATIONALE ................................................................. 1
A. Country and sector issues.................................................................................................... 1
B. Rationale for Bank Involvement ......................................................................................... 3
C. Higher-level objectives to which the project contributes ................................................... 4
II. PROJECT DESCRIPTION ................................................................................................. 5
A. Lending instrument ............................................................................................................. 5
B. Project objective and phases ............................................................................................... 6
C. Project Development Objective and key indicators ............................................................ 7
D. Project components ............................................................................................................. 7
E. Lessons learned and reflected in the project design .......................................................... 15
F. Alternatives considered and reasons for rejection ............................................................ 16
III. IMPLEMENTATION .................................................................................................... 16
A. Partnership arrangements .................................................................................................. 16
B. Institutional and implementation arrangements ................................................................ 17
C. Monitoring and evaluation of outcomes/results ................................................................ 19
D. Sustainability and Replicability ........................................................................................ 19
E. Critical risks and possible controversial aspects ............................................................... 20
F. Loan/credit conditions and covenants ............................................................................... 23
IV. APPRAISAL SUMMARY ............................................................................................. 25
A. Economic and financial analyses ...................................................................................... 25
B. Technical ........................................................................................................................... 26
C. Fiduciary ........................................................................................................................... 26
D. Social................................................................................................................................. 27
E. Environment ...................................................................................................................... 28
F. Safeguard policies ............................................................................................................. 28
G. Policy exceptions and readiness........................................................................................ 29
v
Annex 1: Country and Sector or Program Background ......................................................... 31
Annex 2: Major Related Projects Financed by IDA and/or other Agencies ......................... 36
Annex 3: Results Framework and Monitoring ........................................................................ 37
Annex 4: Detailed Project Description ...................................................................................... 45
Annex 5: Project Costs ............................................................................................................... 82
Annex 6: Implementation Arrangements ................................................................................. 86
Annex 7: Financial Management and Disbursement Arrangements ..................................... 96
Annex 8: Procurement Arrangements .................................................................................... 111
Annex 9: Governance and Anti-Corruption Arrangements ................................................. 127
Annex 10: Economic and Financial Analysis ......................................................................... 134
Annex 11: GEF Incremental Cost Analysis ............................................................................ 138
Annex 12: Safeguard Policy Issues .......................................................................................... 145
Annex 13: Project Preparation and Supervision ................................................................... 147
Annex 14: Documents in the Project File ............................................................................... 148
Annex 15: Statement of Loans and Credits ............................................................................ 149
Annex 16: Country at a Glance ............................................................................................... 150
Annex 17: Maps......................................................................................................................... 152
vi
UGANDA
AGRICULTURAL TECHNOLOGY AND AGRIBUSINESS ADVISORY SERVICES
PROJECT APPRAISAL DOCUMENT
AFRICA
AFTAR
Date: May 26, 2010 Team Leader: Madhur Gautam/Sergiy Zorya
Country Director: John Murray McIntire Sectors: Agricultural extension and research
Sector Manager/Director: Karen McConnel (70%); Agricultural marketing and trade
Brooks/Inger Andersen (20%); General agriculture, fishing, and
Project ID: P109224 forestry sector (10%)
Environmental Assessment: Partial Themes: Rural services and infrastructure
Assessment (40%); Rural policies and institutions (40%);
Lending Instrument: Specific Investment Loan Rural markets (20%)
Global Supplemental ID: P108886 Team Leader: Madhur Gautam/Sergiy Zorya
Lending Instrument: Specific Investment Loan Sectors: General agriculture, fishing, and
Focal Area: L-Land degradation forestry sector (100%)
Environmental Assessment: Partial Themes: Climate change (50%); Other
Assessment environment and natural resources
Supplement Fully Blended?: Yes management (50%)
Project Financing Data
[ ] Loan [X] Credit [X] Grant [ ] Guarantee [ ] Other:
For Loans/Credits/Others:
Total Bank financing (US$ m): 127.20
Proposed terms: Standard IDA terms with 40 years maturity and 10 year grace period
Financing Plan (US$m)
Source Local Foreign Total
BORROWER/RECIPIENT 497.3 0.0 497.3
International Development Association (IDA) 46.1 73.9 120.0
Global Environment Facility (GEF) 5.1 2.1 7.2
Financing Gap (to be financed by Danida, EU, and IFAD) 15.8 25.2 41.0
Total: 564.3 101.2 665.5
Borrower:
Government of Uganda
The Republic of Uganda
Responsible Agency:
NAADS Secretariat
Mukwasi House, Lumumba Ave., Uganda
Tel: 256 414 345440 Fax: 256 414 347843
naads@naads.or.ug
vii
NARO Secretariat
P.O. Box 295, Uganda
Tel: 256 414 320 512 Fax: 256 414 321 070
dgnaro@infocom.co.ug
Estimated disbursements (Bank FY/US$m)
FY 11 12 13 14 15
Annual 23.3 25.7 26.8 23.5 20.7
Cumulative 23.3 49.0 75.8 99.3 120.0
GEF Estimated disbursements (Bank FY/US$m)
FY 11 12 13 14 15
Annual 2.0 1.7 1.3 1.1 1.1
Cumulative 2.0 3.7 5.0 6.1 7.2
Project implementation period: Start June 22, 2010 End: June 30, 2015
Expected effectiveness date: September 30, 2010
Expected closing date: June 30, 2015
Does the project depart from the CAS in content or other significant respects?
[ ]Yes [X] No
Ref. PAD I.C.
Does the project require any exceptions from Bank policies?
Ref. PAD IV.G. [ ]Yes [X] No
Have these been approved by Bank management? [ ]Yes [X] No
Is approval for any policy exception sought from the Board? [ ]Yes [X] No
Does the project include any critical risks rated substantial or high?
[X]Yes [] No
Ref. PAD III.E.
Does the project meet the Regional criteria for readiness for implementation?
[X]Yes [ ] No
Ref. PAD IV.G.
Project Development Objective Ref. PAD II.C., Technical Annex 3
The Project Development Objective is to increase agricultural productivity and incomes of
participating households by improving the performance of agricultural research and advisory
service systems in the Republic of Uganda.
Global Environment Objective Ref. PAD II.C., Technical Annex 3
The Global Environmental Objective is to enhance the environmental sustainability and
resilience of agricultural production to land degradation and climate risks.
Project description Ref. PAD II.D., Technical Annex 4
The project includes five components:
Component 1: Developing Agricultural Technologies and Strengthening the National
Agricultural Research System. The objectives of component 1 are to develop agricultural
technologies through research, and to strengthen agricultural research institutions.
viii
Component 2: Enhancing Partnerships between Agricultural Research, Advisory Services, and
other Stakeholders. The objectives of component 2 are to enhance the efficiency and
effectiveness of technology development and dissemination by supporting closer linkages
between NARO, NAADS, and other stakeholders.
Component 3: Strengthening the National Agricultural Advisory Services. The objectives of
component 3 are to support improved delivery of demand-driven and market-oriented advisory
services to farmers to promote their progression from subsistence to market-orientation.
Component 4: Supporting Agribusiness Services and Market Linkages. The objective of
component 4 is to promote integration of smallholders in value chains by supporting
collaboration between agribusiness, farmers, advisers, and researchers to create viable,
sustainable market and agribusiness linkages.
Component 5: Program Management. The objective of component 5 is to support the NARO and
NAADS Secretariats to ensure: (i) efficient execution of administrative, financial management,
and procurement functions; (ii) coordination of project activities among various stakeholders;
(iii) implementation of safeguard measures mandated by the Government of Uganda and IDA;
and (iv) an effective use of the joint M&E and ICT systems established under component 2.
Which safeguard policies are triggered, if any? Ref. PAD IV.F., Technical Annex 10
ATAAS is a category B project and triggers the following safeguard policies: (i) Environmental
Assessment (OP/BP 4.01) and (ii) Pest Management (OP 4.09).
Significant, non-standard conditions, if any, for:
Ref. PAD III.F.
Board conditions:
Letter of commitment by the Government to refund of ineligible expenditures incurred under the
National Agricultural Advisory Services Project (Credit 3463-UG): This condition has been met
as per the letter from the Government dated May 13, 2010. IDA procedures require the refund to
be made by April 2011. However, the Government has indicated it will try to ensure the refund
is made by the Board date of June 22, 2010.
Loan/credit effectiveness:
a. NARO and NAADS have each adopted the Project Implementation Manual in form and
substance satisfactory to IDA.
b. A Subsidiary Agreement has been executed between the Recipient and each of NARO and
NAADS in accordance with the provisions of Section I.B of Schedule 2 to the Financing
Agreement.
c. The Recipient has adopted a revised organizational structure for NAADS Secretariat in
form and substance satisfactory to IDA.
d. The GEF Grant Agreement has been executed and delivered and all conditions precedent to
ix
its effectiveness or to the right of the Recipient to make withdrawals under it (other than
the effectiveness of the Grant Agreement) have been fulfilled.
GEF grant effectiveness:
a. The IDA Financing Agreement and all conditions precedent to its effectiveness or to the right of the
Recipient to make withdrawals under the IDA Financing Agreement (other than the effectiveness of
this Agreement) have been fulfilled.
b. A Subsidiary Agreement has been executed on behalf of the Recipient and each of NARO and
NAADS in accordance with the provisions of Section I. of Schedule 2 to the Grant Agreement.
Covenants applicable to project implementation:
i. No withdrawal shall be made for payments made prior to the date of the Financing
Agreement except that withdrawals up to an aggregate amount not to exceed US$ 15
million equivalent may be made for payments made prior to the date of the Financing
Agreement but on or after July 1, 2010, for eligible expenditures.
ii. No withdrawal shall be made for payments under Category 4 of the eligible expenditures
specified in Schedule 2, Section IV.A of the Financing Agreement, unless and until IDA
shall have communicated to the Recipient that it is satisfied with the policies and
procedures adopted by NAADS for the appraisal, approval, monitoring and evaluation of
the matching grants under the Commercialization Challenge Fund.
iii. The Recipient shall, no later June 30, 2013 or any other date agreed with the IDA, carry out
jointly with IDA and Co-Financiers, a Mid-Term Review (MTR) of the progress made in
carrying out the project; and no later than 30 days after completion of the MTR, start to
implement its recommendations as agreed with IDA and Co-Financiers. The MTR would
assess (i) the overall progress made in the implementation of the project, and (ii) the results
of the monitoring and evaluation activities.
iv. Financial covenants are the standard ones as stated in the Financing Agreement Schedule 2,
Section II (B) on Financial Management, Financial Reports, and Audits and Section 4.09 of
the General Conditions.
v. To promote effective implementation of the Project, the Recipient shall ensure that not later
than March 31, 2011, (a) NAADS shall: (i) facilitate the recruitment of , a District NAADS
Coordinator in each district, a Sub-County NAADS Coordinator in each sub-county, two
full time professional and certified Agricultural Advisory Service Providers all recruited on
Performance-Based Contracts, and (ii) as and when needed, other service providers to
support project implementation at the local level; and (b) NARO shall employ a chief
information officer with qualifications, experience and terms of reference satisfactory to
IDA to support the coordination and oversight of the Project ICT activities.
vi. The Recipient shall, not later than September 30 of each Fiscal Year, and under terms of
reference satisfactory to IDA: (a) carry out a detailed performance audit of NARO and
NAADS on a sample basis. To assist in carrying out each such performance audit, the
Recipient shall employ an independent firm with terms of reference and qualifications and
experience satisfactory to IDA; and (b) conduct a joint annual review of the Project with
IDA and Co-financiers, as well as NARO and NAADS, no later than May 31 of each year.
vii. The Recipient shall, not later than November 30, 2010 or any other date agreed with IDA,
under terms of reference acceptable to IDA, update its ongoing assessments of local
government financial management capacity to include key financial management and
x
governance indicators that will form the basis for a determination of allocations to NAADS
districts.
viii. In order to facilitate the evaluation by the Recipient of the Project's impact, the Recipient
shall, not later than June 30, 2011 or any other date agreed with IDA, conduct a baseline
survey of the agricultural activities of households in project areas under terms of reference
acceptable to IDA.
ix. The Recipient shall not later than December 31, 2010 recruit for the NAADS Secretariat
qualified and experienced professional staff under terms of reference satisfactory to IDA
and consistent with the revised NAADS organizational structure.
xi
I. STRATEGIC CONTEXT AND RATIONALE
A. Country and sector issues
1. Agriculture is a strategic sector for the Government of Uganda (GoU). It features
prominently among the top five priority sectors for public investment in the National
Development Plan (NDP), Uganda's new five-year strategic framework for economic
development. Raising agricultural incomes is the centerpiece of the Prosperity for All Program,
the vision driving the NDP. The new Development Strategy and Investment Plan (DSIP) of the
Ministry of Agriculture, Animal Industry, and Fisheries (MAAIF) has been designed within this
framework and is aligned with the principles and aspirations of the Comprehensive Africa
Agricultural Development Program (CAADP). The DSIP identifies agricultural research and
advisory services as two of the core mandates of MAAIF.
2. Agriculture accounts for 20 percent of gross domestic product (GDP). It remains
important for the structural transformation of the economy through value addition, export
growth, and employment. Official statistics indicate that the agricultural sector grew at an
average annual rate of just 1.3 percent from 2003 to 2008, significantly lower than the
government target of 3.8+ percent. Other evidence suggests that performance of some segments
of the sector may not have been so dismal. Findings from the two National Agricultural Advisory
Services (NAADS) evaluation surveys show an increase in median real wealth per capita of
about 10 percent (across all households surveyed) between 2004 and 2007, with poorer
households doing relatively better than the better-off households. The data on poverty show a
significant reduction in poverty (from 44 percent in 1997 and 38 percent in 2002 to 31 percent in
2005), including rural poverty. Food prices in Uganda have recently increased, but not as sharply
as in neighboring countries. Overall, Uganda weathered the global food price crisis quite well.
3. Uganda is increasingly seen as a potential breadbasket for East Africa. Exports of
primary agriculture commodities, which account for over 50 percent of the country's export
revenues, grew 16 percent per year on average over this period.1 These trends are consistent with
the increase in the real gross value of agricultural production between 2004 and 2007 by 124
percent, and yields increased by 20 percent for maize, 12 percent for sweet potato, 9 percent for
groundnuts, and 24 percent for millet--although yields have declined for sorghum (12 percent),
banana (7 percent), and beans (32 percent).2
4. Significant untapped potential for agricultural growth remains. Agricultural
productivity and commercialization can be increased for most smallholders. A number of
interacting factors depress yields (for both crop and livestock production), reduce the
profitability of enterprises, and make agriculture uncompetitive. Limited use of improved
technology, poor infrastructure (resulting in high transport and energy costs--see Annex 1), lack
of business skills in the sector, and poor integration of smallholders, particularly the poor and
women farmers, into markets and value chains limit the choice and profitability of enterprises,
constraining household incomes.
1
Exports of food staples are increasing to Kenya, Rwanda, and, more recently, southern Sudan and the Democratic
Republic of Congo. Exports of maize and beans to Kenya more than doubled from 2004 to 2008, and in 2008/09
Uganda exported one-quarter of its total marketable maize production, supplying half of Kenya's import demand.
1
5. Members of the National Agricultural Advisory Services (NAADS) farmer groups
have benefited from selecting more profitable enterprises, but the failure to raise yields
represents a major lost opportunity. The impact evaluation of NAADS shows that farmers
have made significant gains by switching to more profitable enterprises, yet they have not come
close to realizing potential farm yields. Low and inefficient use of improved inputs is still
pervasive, and poor land management has been a contributing factor. Historically, real growth in
output over the past 30 years has been driven mainly by expansion in cultivated area and the
labor force, with declining total factor productivity (Annex 1). Reduced opportunities to open
new land for agriculture make it imperative to intensify land use, raise yields of most agricultural
products, and further commercialize agriculture.
6. Soil erosion and deteriorating soil quality further constrain production growth.
Land is a key strategic resource for Uganda (see Annex 11). Land constitutes over 50 percent of
the value of the asset basket of poor Ugandans, but current farming practices threaten soil
fertility. The soils in many parts of sub-Saharan Africa lose fertility through poor nutrient
management (Working Document 4, Annex 14). In Uganda this problem is particularly
pronounced. Land degradation hotspots where soil erosion and infertility are especially rampant
have been identified in the Southwestern Highlands, Lake Victoria Crescent, the Northwest, and
the Eastern Highlands, as well as in the Cattle Corridor. Annual losses of nitrogen, potassium,
and phosphorous in these areas are estimated to be 85, 75, and 10 kilograms per hectare,
respectively. Soil erosion is estimated at above 5 tons per hectare per year.
7. An increasingly variable climate will exacerbate the problems of low crop yields,
declining soil fertility, and degraded soils. Average temperatures in Uganda are projected to
increase by up to 1.5 degrees Celsius in the next 20 years (DFID 2008). Rainfall is more variable
than in the past, with increased incidence of extreme or more frequent periods of intense rainfall.
The frequency and severity of extreme climate events such as heat waves, floods, storms, and
droughts are also projected to increase. Droughts, for example, have been more frequent since
1965, and farmers are already keenly aware of this increasing variability.
8. Productivity growth is hampered by the lack of adequate integration of farmers,
particularly smallholders and the poor, into value chains. Weak value chains and the inability
to link to markets reduce farmers' incentives to adopt improved technologies and pursue more
commercial agriculture.
9. Past investments in research and advisory services have yielded significant benefits.
IDA, along with other DPs, has been a major supporter of both the National Agricultural
Research Organization (NARO) and NAADS since their inception. The physical outcomes and
impact of NARO and NAADS are well documented (see Working Document 1 in Annex 14).
Both NARO and NAADS are also well recognized as pioneers in institutional design in the
region. The major achievements of NARO to date include a pluralistic, client-controlled and
demand-driven national agricultural research system. NAADS has developed a decentralized
service delivery model with farmer institutions playing a central role. Functioning farmer
institutions have been established at all administrative levels to empower farmers to contract and
control advisory services. The potential of NARO and NAADS can be enhanced by
strengthening linkages between the two institutions, as well as between them and other
stakeholders. The current operation addresses this gap.
2
B. Rationale for Bank Involvement
10. Raising agricultural productivity and promoting the commercialization of
agriculture are high government priorities. These priorities are reflected in budget allocations;
both NAADS and NARO received significant Medium-Term Expenditure Framework (MTEF)
allocations.3
11. IDA has a long term commitment to support institution-building for core public
services, such as agricultural research and extension. Over the past 18 years, IDA has
invested in and provided technical support for the institutional development of NARO and
NAADS. 4 Both are innovative and evolving institutions with a good record of results. There is a
strong rationale for continuing this support, given: (i) the commitment of the IDA Country
Assistance Strategy to support the GoU's development priorities, including agriculture; (ii) the
strong commitment of the GoU to agricultural technology; (iii) the high contribution of
agricultural research and advisory services to agricultural growth and poverty reduction, land
productivity, ecosystem services, and climate change adaptation and mitigation; (iv) the positive
impact of IDA's pro-active interaction and support to NARO and NAADS on the design and
quality of research and advisory services in Uganda; and (v) the need for continued support for
institutional, physical, and human capacity building for both institutions.
12. The high returns to investment in agricultural research and advisory services in
Uganda are well documented.5 A study by the International Food Policy Research Institute
(IFPRI) on the impacts of public expenditures and a rigorous impact evaluation of NAADS
provide evidence of positive impacts on farm productivity, income, and wealth. NARO has also
just completed an impact evaluation that shows high returns to its investment in research.
Uganda's system of agricultural technology development and dissemination, which has reached
about 725,000 Ugandan farmers (about 15 percent of all farmers) through NAADS and even
more through research outreach, merits continued support as a core public good.
13. Sustainable management of Uganda's agricultural landscapes has externalities
beyond agriculture. The condition of these landscapes will affect livelihoods, food security,
natural resource management, water resources, forests, human health, and infrastructure. Rapid
population growth combined with poor farming practices and inappropriate land use are exerting
pressure on the natural resource base. Farmers are already responding with sustainable land
management (SLM) practices that include mulching, organic soil amendments, soil and water
conservation structures, and improved land and water use (see Working Paper 5 in Annex 14).
These low-cost measures need to be further promoted and scaled-up by stronger extension and
research services. Thus interventions to promote SLM belong with the promotion of agricultural
technology as complementary actions.
3
For the next five years, MTEF allocations are projected to be almost US$ 500 million for NAADS and about US$
126 million for research. The 2008/09 allocations were US$ 52 million for NAADS and US$ 21 million for NARO.
4
IDA invested US$ 50 million in NAADS over the last seven years, along with seven other DPs in a basket funding
arrangement totaling US$ 110 million. IDA invested US$ 64 million in NARO over the last 17 years through two
phases of the Agricultural Research and Training Project (ARTP).
5
See Working Documents 1 and 8 listed in Annex 14 for a summary of the main findings and key references.
3
14. Supporting research and advisory services for increased productivity is also a cost-
effective response to the potential risks from climate change and land degradation. Crop
and livestock research will help farmers overcome climate risks such as shifting growing
seasons, the changing range of crops suited for particular locations, the increasing scarcity and
lack of reliability of water resources, increasing erosion caused by water, and declining soil
fertility (see Working Document 4 in Annex 14). Agricultural advisory services will provide
farmers with information, technologies, and other forms of education to cope with climate
change and contribute to greenhouse gas mitigation. Improved land and water management can
deliver a triple dividend in adaptation, mitigation, and productivity by accumulating carbon in
soil and biomass and by intensifying production to protect woodlands, tropical high forests, and
bush from agricultural expansion. The former three contracted by approximately 25 percent
between 1990 and 2005, while the latter expanded by 15 percent.
15. Full engagement of IDA and other DPs contributes to achieving good returns to
public investment in agriculture in Uganda. DPs have been engaged with the GoU at the
highest levels on key implementation issues concerning NAADS. This dialogue has resulted in
adjustments to strengthen implementation and address the GoU's concerns, including: (i)
increased use of (two to three year) performance-based contracts for delivery of advisory
services, better engagement of research institutions in the advisory role, and the use of private
service providers; (ii) the expanded role of NAADS in agro-processing, including the promotion
of PPPs, the development and/or strengthening of Higher-Level Farmer Organizations (HLFO),
the introduction and promotion of specific technologies, and the facilitation of links along value
chains; and (iii) support for the progression of farmers along a continuum from food security to
commercial engagement.
16. The GoU has sought assistance from IDA and other DPs to address governance and
corruption challenges in the implementation of NAADS. Increased political attention and
frequent changes in the NAADS program in recent years have introduced uncertainty in NAADS
implementation and created serious governance problems. The frequent changes in guidelines
and modalities for program implementation, lack of transparency, and weak accountability left
the program vulnerable to corruption and misuse of funds in a number of the local governments
(LG). The GoU has responded aggressively by establishing a National Task Force to pursue
cases of corruption, abuse of office, and misuse of funds. In response to these findings, NAADS'
internal audit reports and monitoring, and the Public Accounts Committee investigations, the
Government has: pursued recovery of lost funds; prosecution of implicated staff; administrative
or legal action against the implicated local government officials; disciplinary actions against
implicated farmers including deregistering their groups a NAADS farmer groups; blacklisting of
implicated suppliers; and serving notice to districts and sub-counties with outstanding arrears,
reconciliations or reporting. The Agricultural Technology and Advisory Services (ATAAS)
project is designed to address governance issues at all levels (see Annex 9).
C. Higher-level objectives to which the project contributes
17. The proposed project is fully aligned with the DSIP and its strategic focus is
consistent with the NDP and DSIP objectives of agricultural growth, commercialization,
and poverty reduction. It will enhance agricultural productivity, diversification and value
addition, and promote PPPs in service delivery and agribusiness development. The project will
4
also promote SLM practices,6 strengthen the institutional capacity of NARO, NAADS, and
MAAIF, modernize information technology at NARO and NAADS, and employ new ICT tools.
18. The proposed ATAAS Project is part of the upcoming Country Assistance Strategy
(FY 2011­2014). The strategy recognizes that IDA is asked to support GoU's efforts to foster
the adoption of technology, to improve linkages in value chains by promoting agro-processing
and PPPs, and to reduce risks arising from climate change and land degradation.
19. The project conforms to the Global Environment Facility's (GEF) land degradation
focal area strategic programs 1 and 2, which together cover the rural production landscape.
The project is especially relevant to objective 1 (creating an enabling environment for SLM) and
objective 2 (scaling up SLM to achieve global environmental benefits). The GEF grant is
allocated from the envelope of the World Bank-led multi-agency TerrAfrica/GEF Strategic
Investment Program (SIP) for SLM in sub-Saharan Africa. The project contributes to the SIP
objective and all four of its intermediate results (scaling up, enabling environment, extension
support, and knowledge exchange and M&E development). It also contributes to the goals of
Uganda's National Action Program under the United Nations (UN) Convention to Combat
Desertification, with ancillary contributions to the country's action programs for the UN
Framework Convention on Climate Change and UN Convention on Biological Diversity.
20. Lastly, the project seeks to use the latest innovations in ICT to establish a strong
technology platform to enable a joint workflow at NARO and NAADS at the national,
district, and subcounty levels, to support an effective M&E structure, to encourage effective
knowledge management, and to deliver just-in-time information to farmers.
II. PROJECT DESCRIPTION
A. Lending instrument
21. The proposed IDA allocation is US$ 120 million. A GEF grant in the amount of
US$ 7.2 million to co-finance SLM will be fully blended to respond to land degradation and
climate risks. The project will be implemented over the five-year period from July 1, 2010, to
June 30, 2015. It will be financed as a Specific Investment Loan (SIL) on standard IDA terms. 7
22. The total project cost is US$ 665.5 million. Current commitments from other DPs total
about US$ 41 million, including IFAD (US$ 14 million), the European Union (EU) Delegation
( 15 million or approximately US$ 20 million equivalent), and Danida (DKK 41 million or
approximately US$ 7 million equivalent ). IFAD, the EU Delegation and Danida will co-finance
the project. IFAD and EU Delegation funds will be managed by IDA. The GoU will finance the
major share of project costs, allocating about US$ 497.3 million over the five-year project
period. The funding modality for the operation will be joint DPs and GoU basket funding, one
6
These practices include: (i) integrated soil fertility management; (ii) soil and water conservation (low tillage,
terracing, grass and contour bunds, land rehabilitation in four degraded watersheds, agroforestry, and woodlots); and
(iii) small-scale irrigation and water harvesting (see Table 3-D, Annex 3).
7
The alternative idea of an Adaptable Program Loan (APL was rejected given that research and advisory services
are planned to be included under a Sector Wide Approach (SWAp) framework in the future (see Section F).
5
basket each for NARO and NAADS. Annex 5 illustrates the total project cost including a
breakdown by component and source of funds.
B. Project objective and phases
23. ATAAS will build on the accomplishments of the completed Second Agricultural
Research and Training Project (ARTP II) and the NAADS Projects. ARTP II (which closed
in June 2009) was rated satisfactory and NAADS (which closed in December 2009) was rated
moderately satisfactory in achieving their respective Project Development Objectives (PDOs).
ATAAS provides the next phase of support to both institutions and will consolidate the
achievements of the previous projects by further strengthening the institutions, deepening their
effectiveness, outreach, and linkage to each other, and developing a unified framework for
research and advisory services.
24. Governance and corruption are critical issues for ATAAS. Given the scale of
ATAAS, its national scope and decentralized implementation, it is potentially vulnerable to
corrupt practices and misuse of resources. The Governance and Anti-Corruption (GAC)
arrangements are built on three blocks: (i) accountability in relations between the national and
local governments; (ii) mitigation of fiduciary risks; and (iii) enhanced external accountability.
ATAAS actions will include the following elements: (i) improved accountability mechanisms at
the national and local levels; (ii) improved information disclosure and overall transparency of
decision making at the community level; (ii) better systems of reporting grievances and
complaints using modern technologies such as cell phone text messaging and online reporting;
(iii) systems of rewards and sanctions at LG levels; (iv) improved collaboration with anti-
corruption agencies; and (v) enhanced disclosure of information at the national level using the
internet and other means. The GAC arrangements for ATAAS are described in Annex 9.
25. The ATAAS will promote better institutional collaboration between NARO,
NAADS, and other stakeholders. ATAAS will introduce specific mechanisms and incentives to
encourage NARO and NAADS to work together more closely than in the past. This is a key
rationale for bringing the two programs under a single operation with a shared objective and a
unified results framework. Shared ICT infrastructure, consisting of a joint workflow
management system, joint planning framework, shared M&E system, joint knowledge
management system, and joint external and internal portals, will be established to help re-
engineer business processes at both institutions and create a single, well-coordinated technology
system. While project implementation will be led by the NARO and NAADS Secretariats, they
will work closely with MAAIF to align with the DSIP to achieve project outcomes.
26. The project will complement the East Africa Agricultural Productivity Project
(EAAPP), which seeks to strengthen regional cooperation in the generation of technology,
training, and dissemination programs for four priority commodities (dairy, wheat, cassava, and
rice) by establishing Regional Centers of Excellence (RCoEs). For Uganda, EAAPP supports the
establishment of the RCoE for cassava at the National Crops Resources Research Institute
(NaCRRI). The EAAPP-financed program and objectives are fully integrated into the ATAAS
design and activities to be supported to ensure that efforts are not duplicated or resources wasted.
6
27. A GEF grant will be fully blended with other project resources to promote SLM and
strengthen MAAIF's institutional capacity to coordinate practice and policy on land
degradation and climate risks. These funds will be used to enhance the environmental
resilience and sustainability of agricultural landscapes and to generate local and global
environmental benefits in addition to improved agricultural yields.
C. Project Development Objective and key indicators
28. The Project Development Objective (PDO) is to increase agricultural productivity and
incomes of participating households by improving the performance of agricultural research and
advisory service systems in the Republic of Uganda.
29. The PDO indicators are the percentage increase in average agricultural yields and
agricultural incomes of participating households (disaggregated by gender). Participating
households are defined as farming households who directly benefit from NAADS support
through farmer groups.
30. The Global Environmental Objective (GEO) is to enhance the environmental
sustainability and resilience of agricultural production to land degradation and climate risks.
31. The key performance indicator for GEO is additional land area with improved land
and water management practices. This indicator is considered a proxy for reducing land
degradation risks and delivering national and global environmental benefits (see Annex 11).8
D. Project components
32. The project will support key activities through five components: (i) Developing
Agricultural Technologies and Strengthening the National Agricultural Research System; (ii)
Enhancing Partnerships between Agricultural Research, Advisory Services, and other
Stakeholders; (iii) Strengthening the National Agricultural Advisory Services; (iv) Supporting
Agribusiness Services and Market Linkages; and (v) Program Management.
33. The project will be implemented through two implementing institutions, NARO and
NAADS. The first component will be implemented by NARO, the second jointly by NARO and
NAADS, and the third and fourth by NAADS. Project management will be undertaken by the
NAADS and NARO Secretariats. The project is designed to support the implementation of the
full programs for NARO and NAADS; the institutional responsibilities for ATAAS activities are
the present mandates of these institutions. The project structure makes it possible to: (i) increase
the emphasis on the critical role of the joint activities requiring the two institutions to work
together more effectively to achieve the PDO9; and (ii) more clearly demonstrate the support to
agricultural commercialization under the program, aligning with the objectives of the newly
developed NDP and the DSIP.
8
The specific SLM practices have been identified by the government as key priorities for improving natural
resource management in agricultural landscapes. In addition, as part of its capacity-building activities, the project
will support the development and application of tools for monitoring and projecting land productivity trends in
Uganda, such as vegetative cover, soil health, and carbon accumulation in biomass and soil.
9
A separate component helps raise the profile of these activities, bringing greater attention to them by the
implementing agencies, and will also allow better monitoring of progress.
7
Component 1: Developing Agricultural Technologies and Strengthening the National
Agricultural Research System (US$ 137.8 million: US$ 104 million from GoU, US$ 25.5
million from IDA, and US$ 8.6 million from other DPs).10
34. Objective: to develop agricultural technologies through research and strengthen the
agricultural research institutions.
35. Agricultural research is a core public good and will continue to play a critical role in
productivity growth and improved competitiveness as a basis for the transformation of
agriculture. To strengthen research, this component will provide support to the NARS through
two subcomponents: (1.1) Technology Identification and Development and (1.2) Institutional
Strengthening of the NARS. Subcomponent 1 will result in two specific outputs: (i) core national
strategic and zone-specific research programs implemented; and (ii) non-strategic priority
agricultural topics effectively addressed through Competitive Research Grants (CRGs). The
second subcomponent will focus on strengthening the effectiveness and efficiency of the NARS
and especially NARO by reinforcing human, financial, physical (including infrastructural), and
organizational capacity. This goal will be achieved by: (i) providing support to build the
capacities and competencies of public and private ARSPs; (ii) providing equipment, facilities,
and transport for research; (iii) enhancing the governance of NARO and other public agricultural
research institutes (PARIs) through stakeholder participation and research partnerships; and (iv)
exploring options for sustainable financing mechanisms for NARS.
36. Investment is required to generate relevant technologies, practices, and strategies
for agricultural development. This component of ATAAS is designed to support the
implementation of the National Agricultural Research Program (NARP), without duplicating
what is proposed under EAAPP, and entails investments to reinforce the human, financial,
infrastructural, and organizational capacity of the NARIs and ZARDIs, especially those that were
recently established.
37. Improvements in the NARS will be achieved by updating priorities (jointly with
NAADS and other stakeholders) regularly and sustaining increases in core and CRG
funding.11 National and zonal research priorities will be identified jointly with NAADS and
funded by the core budget. The use of the CRGs will be expanded to: (i) utilize all existing
research capacity; (ii) promote research partnerships especially with the private sector; (iii)
improve access to funds by ARSPs other than NARO Institutes; and (iv) facilitate accelerated
adoption of improved agricultural technologies. The strategic programs will focus on priority
enterprises in the DSIP, complementing the activities funded through EAAPP.
Component 2: Enhancing Partnerships between Agricultural Research, Advisory Services,
and other Stakeholders (US$ 72.4 million: US$ 49.8 million from GoU, US$ 11.5 million IDA,
US$ 7.2 million from GEF, and US$ 3.9 million from other DPs).
38. Objective: to support closer linkages between NARO, NAADS, and other stakeholders.
10
NARO has also received about US$ 22.5 million of additional resources under EAAPP to implement R&D on
cassava (Regional Centre of Excellence), dairy, rice and wheat (mainly NaCRRI, NaLRRI and NARL).
11
CRG funding is mainly for non-salary research operating costs.
8
39. NARO and NAADS fully recognize that effective and functioning linkages are
crucial to achieve their expected joint outcomes and impact. This component will therefore
finance the development of programs and joint activities to facilitate better NARO­NAADS
linkages and collaboration, including with other stakeholders such as private ARSPs and AASPs,
farmer fora, processors, and marketing agents. The main activities will be implemented through
five subcomponents: (2.1) Joint Planning, Priority Setting, Adaptive Research, and Technology
Scale-Up; (2.2) Sustainable Land Management; (2.3) Institutional and Human Capacity
Strengthening; (2.4) Joint Results Framework/M&E; and (2.5) Joint ICT Applications.
40. The implementation of the component and subcomponent activities will follow the
processes and mechanisms laid out in the NARO­NAADS Partnership Framework. NARO,
leading at the zonal level, and NAADS, leading at the district and lower levels, will join in
articulating demand for services, setting priorities, conducting on-farm adaptive research, and
implementing the joint results framework. This effort will entail formal mechanisms for joint
activities, strong multi-stakeholder involvement in priority setting and research, and a strong
research-advisory interface at the national and local levels. Functional multi stakeholder
innovation platforms (MSIPs) will be established to guide research and the uptake of its
outputs.
41. NARO and NAADS would promote joint priority setting, planning and
implementation of on-farm adaptive research, and, where appropriate, technology
multiplication. Following training by the District Adaptive Research Support Teams (DARSTs)
and/or ZARDI scientists, service providers will receive resources to set up on-farm
demonstrations to test new technologies in local conditions. NARO will produce breeder and
foundation seeds and provide training and technical assistance to seed companies. For crops that
do not have established commercial markets for seeds and planting material, NAADS will
support farmer-based multiplication of foundation and quality-declared seeds and the
development community seed producers. NAADS will also facilitate quality control and support
agro-dealer associations.
42. Joint capacity-building and training programs would be carried out to strengthen
institutional capacities of NARO and NAADS. NARO and NAADS staff will be trained on a
range of topics, including environmental and social safeguards. NAADS will support increased
capacity of district level Subject Matter Specialists and AASPs in their areas of expertise and
promote their certification in specific technologies. NAADS will also train community-based
facilitators, develop pedagogical materials, and provide training including on environmental and
social safeguards.
43. The fully blended GEF support will strategically and incrementally promote SLM
practices in the joint work of NARO and NAADS with groups of farmers. It will also
strengthen the performance of MAAIF Headquarters, NARO, and NAADS by promoting cross-
sectoral flows of information, investment planning, and monitoring related to SLM. NARO will
take the lead on research activities and NAADS on advisory services related to SLM.
44. The GEF support is organized around three sets of activities in the overall project.
These are: (i) improving institutional governance by strengthening capacities for SLM planning
and practice at NARO, NAADS, and MAAIF and coordinating with other sectors and
9
stakeholders; (ii) scaling-up SLM activities on the ground for improved natural resource
management (NRM); and (iii) reducing vulnerability through natural resource monitoring and
knowledge management. The Working Document 5 in Annex 14 describes technologies to be
promoted in detail and Annex 3 lists the targets for SLM technologies supported by the project.
45. To monitor progress and outcomes, NARO and NAADS have developed a joint
results framework (RF) and will jointly implement an M&E and impact evaluation
program. NARO and NAADS will be jointly responsible for the strategic planning of ATAAS
activities, and developing a monitoring system to track project progress and effectiveness, and to
demonstrate impacts. The RF and the M&E program are described in more detail in Annex 3.
46. NARO and NAADS will implement a joint ICT strategy and program. Priority will
be given to upgrading ICT infrastructure and developing links with a wide range of stakeholders
covering all constituents of NARO and NAADS, particularly the end-users ­ the farmers.
Innovative use of ICT will contribute to improved governance and transparency, exchange of
information and knowledge, collective learning, and pooling of resources. It will also facilitate
more effective and efficient MIS and M&E systems, both for internal and external use.
Component 3: Strengthening the National Agricultural Advisory Services (US$ 317.8
million: US$ 239.8 million from GoU, US$ 58.1 million from IDA, and US$ 19.9 million from
other DPs).12
47. Objective: to support improved delivery of demand-driven and market-oriented advisory
services to farmers to promote their progression from subsistence to commercial engagement.
48. This component will support the delivery of agricultural advisory services. It will
provide this support through three subcomponents: (3.1) Farmer Institutional Development
(FID); (3.2) Technology Promotion and Farmer Access to Information; and (3.3) Technology
Uptake Grants. The first subcomponent focuses on the core principles of NAADS, which seek to
empower farmers and strengthen their organizations. The second subcomponent supports the
delivery of agricultural advisory services--the main mandate of NAADS. The third provides two
types of grants to farmer groups to support uptake of superior technologies and practices and
promote wider adoption: (i) Food Security Grants to demonstrate and multiply food security
enterprises, and (ii) Market-Oriented Enterprise Promotion Grants to demonstrate and promote
the adoption of commercially promising or market-oriented enterprises.
49. This component makes substantial efforts to deepen NAADS by increasing its
outreach to farmers and helping them move up the value chain. The approach based on
farmer groups and farmer empowerment will remain central to the service delivery model and
will be strengthened as a key element of the program design. The classification of farmers with
respect to the degree of their transition from subsistence to market orientation will be developed
fully to provide the array of services suitable to their objectives. ATAAS will promote pluralism
in service delivery and adopt different approaches as appropriate to local circumstances. A
feasibility study will be undertaken during the first year of implementation to identify mobile
applications and other ICT-supported mechanisms that can be facilitated under ATAAS.
12
EAAPP provides complementary financing by supporting NAADS in training and dissemination (about US$ 1.5
million) and MAAIF and private partners (about US$ 3.5 million) for improved availability of seeds and breeds.
10
50. One of NAADS' core principles is empowerment of farmers, and therefore, Farmer
Institutional Development (FID) is a critical to ensuring that farmers, farmer groups, and farmer
fora play the envisaged role in program governance. Empowerment of farmers (through greater
transparency, effective participation, and decision making) is also a central feature in the GAC
arrangements of the project.
51. Gender mainstreaming and inclusiveness are also key. FID will pay particular
attention to the inclusion of women, youth, people with disabilities, and other poor farmers in
mobilizing groups and the formation of farmer fora. The NAADS Board has recently doubled the
weights for women and youth in the selection criteria for grants.13 Recognizing the economic and
social heterogeneity of the farming community, under ATAAS NAADS will offer graduated
support to different categories of farmers in line with the principle of farmer progression from
subsistence to commercialization. The strategies for strengthening social inclusion and gender
mainstreaming are further discussed in Working Document 7 in Annex 14.
52. Strengthening farmers' capacity to demand services and maintain control of the
program is a top priority for ATAAS. Building on the achievements and lessons of NAADS
Phase I, the FID process continues to strengthen farmers in their organized groups. Owing to
frequent changes in the implementation modalities in the program over the last two years, farmer
groups need to be revitalized. FID efforts will be redoubled in the first year of the program to do
so. As a first step, before program implementation starts, NAADS will carry out a pre-
intervention assessment to determine the eligibility of existing groups in each subcounty under
agreed criteria for group viability, cohesion, and the repayment track record of group members
who received financial support in the past. Based on available information, it is estimated that
about 46,000 viable groups would be ready for implementation of this component in the first
year of ATAAS.
53. The core mandate of NAADS is to promote technology and farmers' access to
technical and market information. Advisory services provide the push that allows farmers to
benefit from better linkages to markets. Consolidating the achievements of NAADS Phase I,
ATAAS would support initiatives by men and women farmers, working together in groups, to
access agricultural advisory services from professional and certified AASPs. Conditional grants
would be channeled through subcounty governments to farmers' fora to finance advisory service
contracts. Services contracted under this mechanism would include technical advisory services
for the enterprises selected by famer groups, general agricultural advisory services, and advisory
services for marketing and business planning. The process of subcounty enterprise selection
would benefit from better links to the research system and other stakeholders, in particular the
private sector, so as to be informed by prevailing market opportunities and conditions.
54. Advisory services will be provided by AASPs engaged through performance-based
contracts. At the district level, all NAADS activities will be coordinated by a District NAADS
Coordinator (DNC), supervised by the District Production Officer (DPO). Based on the needs
assessed by NAADS, each subcounty will have one full-time Subcounty NAADS Coordinator
(SNC) on a long-term (up to three years) performance-based contract. In addition, advisory
13
For Food Security and Market Oriented Enterprise Promotion grants, the criteria weights for women and youth
have been increased from 5 to 10 percent and for the local level Commercialization Challenge Fund to 15 percent.
11
services will be delivered by the equivalent of three full-time certified AASPs contracted at the
subcounty level. These AASPs will include two persons on longer term (up to two years)
performance-based contracts (one each for crops and livestock), complemented by short-term
contracted AASPs for specialized services as needed (up to an equivalent of one full-time
contract in terms of funding). CBFs, drawn from the motivated and progressive farmers from
within the groups, will be trained as farmer advisors to maintain continuity and supplement the
service providers in increasing the outreach of the program.
55. The DNCs, SNCs, and two full time AASPs per subcounty will be engaged under the
NAADS program on long-term performance-based contracts. In addition, several short-term
service providers (equivalent to one long-term AASP) will be contracted to provide specialized
advisory service needs. The hiring will be done using an open, transparent and competitive
process, with the full involvement of farmer fora and other farmer representatives. All qualified
current frontline extension workers, except those who have been involved in malpractices and
misuse of public funds, will have the opportunity to compete for these contracts. To avoid
duplication of functions at the LG level, the government has also decided to streamline
agricultural extension within NAADS. All subcounty employees, and in particular the remaining
frontline extension workers, not engaged under the NAADS program will be re-assigned to non-
extension functions, such as pest and disease control, quality assurance, regulation, planning,
data collection, etc., as will be further defined in the ongoing MAAIF institutional restructuring
process. Clear evaluative criteria and modalities will be articulated in the guidelines to ensure
that SNCs and DNCs, as well as AASPs, will be subject to binding performance reviews by
farmer fora and farmer groups. To ensure effective implementation of the program, the DNC,
SNC and at least one AASP will be expected to be in place prior to the disbursement of funds to
each district. By March 31, 2011, two long-term AASPs are expected to be in place.
56. Eligible farmer groups may access two types of Technology Uptake Grants to
support specific objectives. These grants would promote the progression of farmers from
subsistence to market orientation. They will provide resources to farmer groups to establish
technology demonstration sites, and where appropriate, support technology multiplication. The
sites will provide farmer learning platforms for different categories of farmers and promote
NAADS objectives of farmer-to-farmer knowledge sharing, access to new technologies, and
market integration. In addition, at the national level, NAADS Secretariat will undertake strategic
investments to introduce and facilitate new or improved technologies. Detailed implementation
guidelines for these grants will be developed and included in the PIM. The guidelines will also
be clearly communicated to all stakeholders, including the implementers at the LG level, farmer
groups and farmer fora, including the recommended actions and practices from the ATAAS
GAC arrangements (Annex 9).
57. One type of grant will be for enterprises targeting achieving food security. Each
group would be provided an annual Food Security Grant (on average about UShs 375,000) to
establish a technology demonstration and multiplication site for a food enterprise (see Annex 4).
58. The second type of grant will be to establish and demonstrate promising
technologies for market-oriented enterprises. Each group will identify a market-oriented
farmer from within the group to host the demonstration site for a commercial activity. The host
farmer(s) will be required to pay 70 percent of the value of the Market-Oriented Enterprise
12
Promotion Grant received (in cash) into a group savings account. Each farmer group will receive
grants (on average about UShs 750,000) to establish a demonstration site for one enterprise per
year for a maximum of four years (including support given during NAADS Phase I).
Component 4: Supporting Agribusiness Services and Market Linkages (US$ 63.0 million:
US$ 47.5 million from GoU, US$ 11.5 million from IDA, and US$ 4.0 million from other DPs).
59. Objective: to promote integration of smallholders in value chains by supporting
collaboration between agribusiness, farmers, AASPs, and researchers to create viable,
sustainable market and agribusiness linkages.
60. This component supports collaboration between agribusiness, farmers, advisers,
and researchers to create viable, sustainable market and agribusiness linkages.
Collaboration will be achieved through activities under two subcomponents: (4.1) Agribusiness
Development Services and (4.2) Establishment of a Commercialization Challenge Fund (CCF).
61. Building on a successful partnership model developed by NAADS, the program
would use the market to "pull" farmers out of subsistence agriculture. The goal is to
increase farmers' participation in markets and the private sector's contribution to the agricultural
economy.
62. The selection of enterprises supported by NAADS will take value-chain
considerations and market outlets into account. This component will strengthen the capacity
of groups to improve the selection and management of enterprises through better agro-ecological
and regional analysis, basic business skills, and information on market prospects and
profitability. At the district level, support will be provided to farmer groups to organize into
HLFOs to help them effectively participate in value chains.
63. NAADS will not be involved directly in rural financial services but will improve
farmers' access to rural financial services by facilitating the farmer groups' links to sound
financial institutions. NAADS will provide information and advice for preparing applications for
commercial and rural financial institutions, including for emerging commercial farms and
agribusinesses. NAADS would review and work in collaboration with other initiatives and
agribusiness programs or projects supported by DPs or agencies for the provision of technical
support to agro-dealers, the provision of market information to farmers and AASPs, and the
provision of other business development services.
64. To support commercialization, NAADS will establish a CCF. Building on experiences
in Uganda and internationally, described in the Working Document 3 in Annex 14, the fund will
provide matching grants, on a competitive basis, in response to proposals under two windows.
65. At the national level, CCF (Window 1) will aim to integrate smallholder farmers
into value chains by forging partnerships between smallholders and commercial growers,
and promoting competitiveness of agribusinesses. This part of the CCF will be used to support
innovations and partnerships with emerging and existing nucleus farmers and agribusinesses to
enhance market linkages for NAADS groups and promote social inclusion. Established farmers,
agro-processors, and other agribusinesses will be eligible to apply for support in the form of a
matching grant to stimulate production or processing from NAADS groups. They will offer
13
specialized, professional advisory services to farmers as well as provide access to improved
technologies, bulking facilities, and linkages to higher levels of the value chains.
66. The CCF Window 2 will be established at the local level for promising
commercialization, value addition, or agroprocessing opportunities. This window of the fund
would seek to encourage progression of farmers from subsistence and lower initial level of
market orientation to commercialization of their farming activities. Using the value chain
approach, CCF Window 2 will provide support to emerging or minimally commercial farmers to
become more commercial.
Component 5: Program Management (US$ 74.5 million: US$ 56.2 million from GoU, US$
13.6 million from IDA, and US$ 4.7 million from other DPs).
67. Objective: to support the NAADS and NARO Secretariats to ensure: (i) efficient
execution of administrative, financial management, and procurement functions; (ii) coordination
of project activities among various stakeholders; (iii) implementation of safeguard measures
mandated by the GoU and IDA; and (iv) an effective use of the joint M&E and ICT systems
established under component 2.
68. NAADS and NARO have their own governance and management structures as
established by the NAADS Act (2001) and NAR Act (2005), respectively. This component
will have two subcomponents: (5.1) NARS Coordination and NARO Management and (5.2)
NAADS Management and Coordination.
69. Agricultural research is coordinated and managed by NARO. The NARO Secretariat
will implement ATAAS research activities through the NARS, under the oversight of the NARO
Council. NARO Secretariat will be supported to construct training facilities, replace old vehicles
and office equipment, as well as facilitated with overhead and operating costs to develop a
NARS-wide capacity and competencies development program for market-oriented research,
environmental issues, gender mainstreaming, and working in multi-institutional and inter-
disciplinary teams. This program would strengthen policies, guidelines, standards, processes,
quality control, and stakeholder capacity building. An incentive scheme to enhance performance
and retention of research staff in both NARIs and ZARDIs will be developed and implemented.
ATAAS will support technical assistance for the NARO Secretariat to explore options for
strengthening the financial resource base for research. The staffing levels across NARO are
currently 5 percent below the target for 2010/11 as per its five-year staffing strategy. The GoU
has committed to increasing its budget allocations, which along with ATAAS DP financing will
permit NARO to fill all its vacant positions, as per its current staffing plan (dated April 2008), by
December 30, 2010, and thereafter implement its time-bound staffing strategy.
70. The NAADS program is managed and coordinated by the NAADS Secretariat.
Established institutional entities at all levels of government will be supported to coordinate and
administer ATAAS-financed activities managed by NAADS. At the national level, this support
will include maintenance of the NAADS Board and Secretariat, who will, under the policy
guidance and oversight of MAAIF Headquarters, continue to manage the program according to
the NAADS Act. For details, see Annex 4.
14
E. Lessons learned and reflected in the project design
71. Various assessments, studies, and implementation reports provide lessons that have been
incorporated in the proposed project. Among these are:
(i) Governance weaknesses at the LG level resulted in corruption and misuse of NAADS
funds. With almost 80 percent of NAADS funds going directly to LG system, the design
of ATAAS places particular emphasis on building in governance and anti-corruption
safeguards at all levels to ensure full transparency and accountability for program funds.
(ii) Lack of ownership and understanding of NAADS principles has eroded governance of
the NAADS program at the LG level. The NAADS interface with LG will be enhanced to
ensure better ownership of the program and enforcement of NAADS guidelines. In
addition, LG capacity-building frameworks under the Local Government Development
Program (LGDP) will be integrated into the NAADS risk management framework.
(iii) Farmer empowerment and ownership of NAADS by farmer groups have been
undermined by the multiple changes in implementation modalities. There was also
inadequate investment in the farmer empowerment. The investment in FID under
ATAAS will be increased to ensure that farmers enhance control of the program and that
rules of accountability and transparency are upheld at all levels.
(iv) The quality of NAADS service delivery was often affected by the inadequate capacity
and insufficient numbers of AASPs to respond to farmer needs. Under ATAAS, NAADS
will develop and implement a strategy and plan for capacity development of AASPs,
including quality assurance, in close collaboration with NARO.
(v) Weak NARO­NAADS linkages limit the extension of research outputs to farmers' fields.
Poor feedback about farmers' demands and problems constrains the development or
refinement of technologies. The design of ATAAS addresses these issues directly by
placing a high priority on strengthening the linkages between the NARS and other
stakeholders in agricultural R&D, especially NAADS but also other providers of research
and advisory services.
(vi) NARO's priority setting sometimes did not capture crucial short-term priorities for
enterprise development and marketing. NARO and NAADS will merge their priority
setting and annual review processes at the zonal and national levels. This will improve
the inclusion of NAADS' (zonal/district) goals for agricultural commercialization and of
MAAIF's (national) development objectives in the NARS agenda.
(vii) NAADS Phase I advisory services focused more on the production side and did not
sufficiently link the selection of enterprises to market conditions or prospects. Although
an agribusiness and market linkages component was explicitly included in the design at
the NAADS MTR, there is a clear need to scale up the support for commercialization and
agribusiness development. The ATAAS design addresses this issue directly.
(viii) Challenges arising from climate change and variability call for increased investments in
NRM research programs. Under ATAAS, GEF funding will further strengthen and
integrate NRM into commodity value chains and provide technologies to mitigate the
effects of climate change.
(ix) Although NARS reforms have been implemented, certain areas need additional
strengthening. For example, the participation and empowerment of private ARSPs
15
providers must increase, and the challenges of establishing and managing PPPs must be
overcome. NARO plans to hold interactive fora with potential partners and allocate
additional resources to this agenda.
(x) Fluctuation in funding from different sources has had significant impacts on the
implementation of research activities. Under ATAAS, NARO will develop alternative
resource mobilization strategies to ensure sustainable funding for R&D.
(xi) The lack of effective M&E systems has been a serious weakness. Under ATAAS, the
M&E/MIS processes will be better institutionalized and integrated between NARO,
NAADS, and MAAIF systems, with enhanced participation of other stakeholders.
F. Alternatives considered and reasons for rejection
72. The alternative of designing the project as a part of the Adaptable Program Loan
(APL) was considered but rejected. The APL instrument was considered unsuitable, given the
need to lay the foundation for a SWAp. An APL would have been preferred if IDA were to
continue its support only for research and advisory services. IDA and other DPs are fully
committed to supporting the DSIP by investing in the other core public functions of MAAIF to
ensure sustainable agricultural growth.
73. The alternative of waiting for the DSIP to emerge as a viable investment plan to
serve as a basis for a full SWAp was not desirable because of timing The financing gap that
would be created in waiting for a full SWAp was deemed too damaging, especially for NARO.
74. The alternative of having separate projects for agricultural research and advisory
services, as in the previous phase, was considered but rejected. The positive outcomes of past
projects supporting NARO and NAADS individually notwithstanding, a key lesson emerging is
that their effectiveness has been constrained by the lack of formal linkages between research and
extension, in particular at the local level. NARO and NAADS are now well positioned to exploit
synergies and deliver increased results for the sector.
75. The alternative of having the GEF-financed activities be complementary but not
blended with IDA was considered but rejected. The GEF will finance SLM activities to help
prevent and reduce the impact of land degradation on ecosystem services in agricultural
landscapes and thus strengthen farmers' capacity to adapt to climate change. Since NARO and
NAADS will implement most of the SLM activities, they should be embedded in their core
activities rather than constitute an independent program. Therefore, the GEF Grant will be fully
blended with IDA and other financial resources to promote SLM in ATAAS.
III. IMPLEMENTATION
A. Partnership arrangements
76. ATAAS will be financed jointly by DPs through basket arrangements for NARO and
NAADS. DPs intending to contribute at this stage include IDA, GEF, IFAD, the European
Union, and Danida, but the design is flexible to allow others to join at a later date. The co-
financing agreements for all DPs are expected to be effective by March 31, 2011. The IFAD
Loan will be presented to the IFAD Executive Board for approval on September 16, 2010. Upon
16
signing of the IFAD Financing Agreement and the declaration of effectiveness of the IDA
Credit, the IFAD loan will be available for and will be administered by IDA. IDA and IFAD will
co-finance their share of the project costs with a pari passu ratio of 90% for IDA and 10% for
IFAD. The European Union contribution will also be administered by IDA through a trust fund
arrangement, expected to be in place by March 31, 2011. Danida funds will be available through
an addendum to an existing Government-to-Government agreement which will be signed after
the effectiveness of the IDA Credit. The coordination of financial support, technical knowledge,
and international experience among DPs will bring substantial benefits, reduce the costs of
government-led coordination of DP support, and reduce waste arising from overlapping donor
activities in line with Development Partner commitments on aid effectiveness.
77. Given the emphasis in ATAAS on commercialization, especially in the promotion
and delivery of advisory and agribusiness services by NAADS, strong partnerships will be
forged between public and private sector players. Some of the key private sector partners include
knowledge and support service providers, commercial banks, micro-finance institutions, agro-
dealers, agro-processing companies, traders, and other value-chain players.
78. Because the GEF resources are allocated under the multi-agency GEF SLM
umbrella led by the Bank (the SIP), the project will participate in knowledge fertilization
with four other operations promoting SLM in Uganda that are also under the SIP. These
projects are supported by UNDP (Cattle Corridor), FAO (Kagera Basin), UNEP (Community
Initiatives in SLM), and IDA (Lake Victoria). The last three projects also include neighboring
countries. Linkages will be made to the regional and continental level via the TerrAfrica
platform to share knowledge and raise capacities of staff and stakeholders involved in the
project. These efforts will strengthen a continent-wide community of practice to disseminate
experience on what works where and why.
B. Institutional and implementation arrangements
79. MAAIF is the ministry responsible for the agricultural sector and shall have the
overall national responsibility for the ATAAS project. ATAAS will be implemented within
the framework of MAAIF's DSIP, with the Agricultural Sector Working Group providing
overall policy direction. The NARS reforms in 2005 configured NARO as the apex body
responsible for policy, coordination, funding, and quality control of agricultural research in
Uganda. The agricultural research system was transformed from a predominantly public system
to a pluralistic system, bringing on board a cross-section of ARSPs including NARIs and
ZARDIs, universities, farmer associations, CSOs, the private sector, and any other entity
engaged in agricultural research. Key features of the reforms include the separation of funding
from agricultural research services implementation, provision of CRGs to all eligible participants
in the NARS to enhance focused research and innovation, and semi-autonomy of the PARIs.
80. NARO is governed by the NAR Act (2005) and is directly accountable to the
Minister for MAAIF. NARO Secretariat provides management support to the NARO Council
and performs its day-to-day business. NARO Secretariat is designated as the oversight and
coordination body for the NARS and will be the implementing agency for ATAAS-financed
research activities. The PARIs are governed by their respective Management Committees (MCs).
The NARIs are responsible for strategic and long-term research, whereas ZARDIs concentrate
17
on but are not limited to research on zonal priorities. Their main focus is adaptive and applied
research and outreach activities and they are the focal point for research-extension linkages.
81. NAADS is governed by the NAADS Act (2001) and is directly accountable to the
Minister for MAAIF. The NAADS Secretariat forms the NAADS Executive, undertaking the
coordination and management of the NAADS program. The Secretariat is responsible for
coordinating the program with the ministries responsible for finance and LG. The Secretariat has
responsibility for planning, directing, guiding, supporting, and managing the program. The
NAADS Board is designated by the Act to facilitate, supervise, and support the NAADS
Executive in implementing the program.
82. The District and Subcounty play a major role in the implementation of the NAADS
program. The NAADS Coordinators at the district and subcounty levels are LG employees but
will be recruited and remunerated under NAADS performance-based contracts. Their activities
will be fully integrated and mainstreamed within the District Production Departments and
embedded in their management processes. The specific roles that LGs play include oversight,
coordination, technical backstopping, financial and procurement management, and monitoring
the NAADS program within their respective jurisdictions. LG also facilitate planning, budgeting,
and integration of NAADS in annual work plans. They will be responsible for preparing
statutory accounts and financial reports and submitting them to the authorities described in the
NAADS participation Memorandum of Understanding (MoU). The Chief Administrative Officer
(CAO) is the Accounting Officer for the district. The DNC will work under the direct
supervision of DPO and reports to CAO through DPO. The district structure will extend to the
subcounties, where farmers will be in charge of implementation. The Subcounty Chief will be
the Accounting Officer at this level on a delegated basis. The SNC will be responsible for
coordinating the work of the farmer fora, which will plan and implement program activities.
83. In line with the NAADS program's central principle of empowering farmers, the
implementation of ATAAS will enhance the capacities of subcounty farmers (in farmer fora) and
the roles that they play. The specific roles of farmer fora in managing and implementing NAADS
are spelled out in the descriptions of the project components. This role is central to NAADS
program management. Resources have been allocated to redesign and improve governance and
management systems to ensure that farmers are in control of program resources. Services
supported by NAADS shall be directed at farmer groups, implying that individual farmers will
access services and benefit from them by belonging to groups. The farmer groups, through the
farmer fora, are responsible for planning, tendering, and contracting as well as for supervising,
monitoring, and evaluating activities. The farmer groups are at the front line of NAADS
management, and their effectiveness has the most influence on the effectiveness of NAADS
primary outputs and impact. Substantial resources will be provided for building their
management and governance capacities.
84. NARO and NAADS will be jointly responsible for the implementation of component
2. At the national level, implementation responsibility would be with a senior staff person in
each of the two organizations, backed up by joint NARO-NAADS Committees for each
subcomponent comprised of concerned staff. Coordination would be with the NARO Council
Users Committee and the NAADS Board Programs Committee. At the zonal level,
18
implementation responsibility would be with ZARDI Directors and NAADS Zonal Coordinators
(lead person). Here oversight would be carried out by the ZARDI MCs.
C. Monitoring and evaluation of outcomes/results
85. NARO and NAADS will be jointly responsible for strategic planning of project
activities and monitoring their results. The M&E system will: (i) monitor and track progress
and effectiveness in the implementation of the project (inputs, activities, processes, outputs,
intermediate outcomes, and PDO and GEO indicators); (ii) conduct a baseline survey at the
commencement of the project; and (iii) conduct an impact evaluation to measure the final
outcome (results) of the project interventions at the Mid-Term Review (MTR) and upon closing
the project. A nationally representative baseline household survey will be undertaken by June 30,
2011. A results framework, which gives the outcome and intermediate outcome indicators along
with annual targets, is presented in Annex 3. The PIM will identify specific activities to be
implemented for realizing each intermediate outcome indicator in the results framework.
86. NARO and NAADS Secretariats will be jointly responsible for the strategic
planning of project activities and the monitoring of their results. A joint Steering Committee
chaired by the Planning Department of MAAIF and comprising the M&E and planning staff of
NARO and NAADS, and a representative from Uganda Bureau of Statistics (UBOS) will
oversee the implementation of M&E activities. The day to day implementation of ATAAS M&E
activities will be the responsibility of a joint team of NARO and NAADS M&E staff, led by the
M&E officer from each organization for a period of two years on a rotating basis.
87. A customized MIS will be developed, and the capacity of the implementing
institutions will be enhanced for the successful implementation of the project. The system
will be developed based on the joint project results framework and focus on the results chain--
linking the PDO and GEO to Project Intermediate Outcome indicators, outputs, activities, and
inputs. This tool will be fully integrated into the improved ICT environment envisaged under the
project. This tool will be effective for project management and provide a feedback loop for the
project team to detect and provide solutions to implementation problems as they emerge (see
Annex 3 for details on the MIS, M&E Plan, and the project results framework)
D. Sustainability and Replicability
88. The sustainability of project activities will depend, to a large extent, on how benefits
accrue to farming communities and other stakeholders, so as to give them an incentive to
maintain and further develop the investments made under the project. It will also depend on
effective governance structures to ensure that farmers play a critical role in all aspects of the
program. Sustainability will also be influenced by the effectiveness and efficiency of the
interface between agricultural research and advisory services, in particular at the zonal level. The
design of ATAAS is predicated on the maintenance of demand-driven and market-oriented
advisory services, the empowerment of farmer organizations, the integration of farmers in value
chains, and strengthened links between NARO and NAADS at various levels. Enhanced
safeguards have been put in place to ensure that these conditions are maintained.
19
89. The sustainability of the project is also ensured by the close collaboration of IDA
with the Government and other development partners involved. Through the DSIP, ATAAS
will support the government's efforts to further harmonize and align donor support in close
collaboration with development partners. Furthermore, the project's implementation follows the
subsidiarity principle, under which most activities are implemented at the district and
subcounty levels. Institutional sustainability is likely to be achieved because the project will be
mainstreamed into government structures.
90. There is ample scope to increase agricultural productivity, the profitability of small-
scale farmers' enterprises, and thus pro-poor economic growth in Uganda. ATAAS will
support sustainable and profitable productivity growth in small-scale farming systems by
providing farmers with environmentally sustainable alternative technologies that help them
respond to market demands. The FID process will ensure that supply chains for technology,
knowledge, and support services respond to farmers' choices and preferences. Market and
agribusiness services and support will stimulate agricultural growth and stakeholders' revenues
by adding value and enhancing producers' links with input and output markets.
91. The MAAIF-led SLM platform is a key ingredient for sustaining the project's
impact on SLM and climate risk mitigation. MAAIF is the key to linking NARO and NAADS
with other implementing agencies in the sector and thus coordinating on knowledge, policy
alignment, and investment in agriculture and across sectors. This platform is an important
ingredient for a future SWAp, as a programmatic approach is already being developed for SLM,
and it provides a channel for coordinating climate change interventions in Uganda. Efforts in this
direction improve the long-term sustainability of project efforts.
E. Critical risks and possible controversial aspects
92. The residual risk of project implementation is rated as substantial, due to governance
problems associated with NAADS and financial management and procurement risks. A number
of checks and safeguards have been identified to address the observed weaknesses, particularly at
the local level. These include strengthened internal audit; increased inspection and investigation
mechanisms; enhanced complaints mechanisms and other external social accountability
mechanisms such as third party monitoring; enhanced internal social accountability including
community procurement; better disclosure; and in general increased empowerment of farmers
and farmer fora (see Annex 9). The ICT supported under the project would be an important tool
for facilitating the monitoring and implementation of these measures. While the proposed
measures are good and they will help reduce the risk level significantly, they will take some time
to put in place and become fully functional (some up to six months to a year to be fully
implemented). For this reason, the current residual risk is rated substantial but with the proposed
intensive supervision, the risk levels are expected to be reduced after the initial supervision
missions. A summary of major risks and the proposed mitigation measures follows in the table.
20
Description of risk Ratinga Mitigation measures Ratinga
of risk of
residual
risk
Country and Sectoral
Increasing spending pressures S Government is committed at the highest M
particularly in the run-up to elections political level to fund NARO and NAADS to
in 2011 may adversely affect planned enhance agricultural growth. This is supported
allocations to NARO/NAADS or by (i) signing of the CAADP Compact in
result in problems with counterpart March 2010; (ii) committing the projected
funding. MTEF levels to the sector; and (iii) achieving
good budget execution levels in the past.
The continued food crisis in East S IDA is engaged in proactive policy dialogue to M
Africa and slow food supply prevent policy reversals and continues to
response in Uganda may result in support strengthening of institutions and
protectionist measures and food procedures. The government's commitment to
export taxes. a liberal trade regime and regional integration
under the East African Community and
Common Market for Eastern and Southern
Africa remains high.
Inadequate follow-through on H The government is implementing several S
corruption reports from commission measures to combat corruption. The PRSC
of enquiry, Auditor General, dialogue has been broadened to tackle
Inspector General of Government, corruption using a multi-pronged approach to
and Parliament. Limited enforcement enhance accountability (Public Financial
and prosecution of identified cases. Management and Procurement), value for
money (sector reviews), and enforcement (case
backlog management, special anti-corruption
court, new anti-corruption Act).
Operational
Changes in the mode of service S Guidelines, manuals, and legal agreements will M
delivery may harm farmers' reinforce NAADS principles of farmer
ownership and empowerment in the selection and rebuild the confidence of
NAADS program. NAADS groups in the program.
Weak enforcement of fiduciary H An anti-corruption and governance plan that S
procedures and political goes beyond IDA's standard fiduciary
interventions in NAADS may lead to measures has been prepared and will be built
corruption. into manuals and operating procedures.
NAADS Secretariat and Government Security
Agencies are pro-actively identifying and
pursuing possible corrupt practices.
The linkages between research and S ATAAS explicitly focuses on formalizing M
extension remain weak. linkages under component 2 of ATAAS.
Input distribution may crowd out the M Input delivery remains in the private sector, L
private sector and benefit wealthier crowding in rather than crowding out the
farmers. private sector. Further, inputs are provided to
promote technology adoption and create
demand for further purchase of inputs through
the market. Targeting rules will be specified in
revised guidelines and enforced by farmer fora.
Financial Management Risks
21
LGs (subcounties and districts) may S The Finance and Accounts Department at M
fail to account for funds advanced NAADS will be responsible for follow up with
and could delay in submitting all LGs. Regional Accountants will be
relevant reports. recruited to monitor, supervise, and train LG
staff. Reporting timelines at each level are to
be instituted. Proper facilitation of subcounties
is proposed. MoUs will be signed with LGs to
this effect.
The project has a multiplicity of H This risk will be mitigated by MoUs signed S
actors and levels of implementation between NARO and each implementing
(districts, subcounties, and institution/agency and between NAADS and
communities), and is potentially each LG, which spell out duties and
difficult to monitor and supervise. responsibilities. Staff will be specifically
assigned to the project to ensure that all
concerned understand their undertakings and
responsibilities.
Inadequate capacity to follow up on H NARO and NAADS have qualified and S
reported internal control weaknesses. experienced internal auditors who will review
Weak internal audit function at all the internal control environment at all
levels and outdated Financial implementation levels. NAADS will strengthen
Management (FM) Manuals. its internal audit function (Board audit
committee, elevation of Internal Audit to
department as well as link to the LG internal
audit units). LG internal audit will report to
central government Public Accounts
Committee. Revision of FM Manual and
preparation of FM handbook.
Financial information may be late H Formats of unaudited Interim Financial S
and unreliable for preparing the Reports (IFRs) have been prepared and agreed
required reports, mainly due to use with IDA. The MoUs will also enhance the
of manual systems. Consistent late reporting timeline for the institutions.
reporting. NAADS needs to automate data capture at the
subcounty level. Reporting timelines will be
instituted and adhered to at all levels.
Procurement Risks
Inadequate organizational structure H Head of Procurement Unit position is to be S
and reporting lines for the NAADS established at a managerial level in the
Procurement Unit result in organization, with the Head reporting directly
inadequate supervision of the to the Executive Director and participates in
procurement function. management.
Participation of the function at a
strategic level in the organization
and the program is limited and the
insufficient seniority creates
governance risks for the
procurement function.
Elite capture of the procurement H Subcounty Procurement Committees will be S
committee at the subcounty level required to publish their decisions on selected
may result in collusion, over suppliers, contract prices, and expected
pricing and partial deliveries. quantities (for example, at subcounty and
districts offices, and other public places).
Inadequate accountability and NAADS Secretariat in conjunction with the
reporting by the procurement districts shall facilitate regular and updated
22
committee to its community results market prices of commonly procured items to
in lack of adequate information at the subcounties.
the community level for Subcounty Procurement Committees to be
monitoring. composed of only farmer group
representatives.
Overall Project Risk H S
a
Rating of risk on a four-point scale (High, Substantial, Moderate, Low) according to the likelihood of
occurrence and magnitude of potential adverse impact.
F. Loan/credit conditions and covenants
93. Conditions of Effectiveness
a. For IDA Credit:
(i) The NARO and NAADS have each adopted the Project Implementation Manual in form
and substance satisfactory to IDA.
(ii) A Subsidiary Agreement has been executed between the Recipient and each of NARO
and NAADS in accordance with the provisions of Section I.B of Schedule 2 to the
Financing Agreement.
(iii) The Recipient has adopted a revised organizational structure for NAADS Secretariat in
form and substance satisfactory to IDA.
(iv) The GEF Grant Agreement has been executed and delivered and all conditions precedent
to its effectiveness or to the right of the Recipient to make withdrawals under it (other
than the effectiveness of this Agreement) have been fulfilled.
b. For GEF Grant:
(v) The IDA Financing Agreement and all conditions precedent to its effectiveness or to the
right of the Recipient to make withdrawals under the IDA Financing Agreement (other
than the effectiveness of this Agreement) have been fulfilled.
(vi) A Subsidiary Agreement has been executed on behalf of the Recipient and each of
NARO and NAADS in accordance with the provisions of Section I.B of Schedule 2 to the
Grant Agreement.
94. Disbursement conditions
(i) No withdrawal shall be made for payments made prior to the date of the Financing
Agreement except that withdrawals up to an aggregate amount not to exceed US$ 15
million equivalent may be made for payments made prior to the date of the Financing
Agreement but on or after July 1, 2010, for eligible expenditures.
(ii) No withdrawal shall be made for payments under Category 4 of the eligible expenditures
specified in Schedule 2, Section IV.A of the Financing Agreement, unless and until IDA
shall have communicated to the Recipient that it is satisfied with the policies and
23
procedures adopted by NAADS for the appraisal, approval, monitoring and evaluation of
the matching grants under the Commercialization Challenge Fund.
95. Dated Covenants
(i) The Recipient shall, no later June 30, 2013 or any other date agreed with the IDA, carry
out jointly with IDA and Co-Financiers, a Mid-Term Review (MTR) of the progress
made in carrying out the project; and no later than 30 days after completion of the MTR,
start to implement its recommendations as agreed with IDA and Co-Financiers. The MTR
would assess (i) the overall progress made in the implementation of the project, and (ii)
the results of the monitoring and evaluation activities.
(ii) Financial covenants are the standard ones as stated in the Financing Agreement Schedule
2, Section II (B) on Financial Management, Financial Reports, and Audits and Section
4.09 of the General Conditions.
(iii) To promote effective implementation of the Project, the Recipient shall ensure that not
later than March 31, 2011, (a) NAADS shall: (i) facilitate the recruitment of , a District
NAADS Coordinator in each district, a Sub-County NAADS Coordinator in each sub-
county, two full time professional and certified Agricultural Advisory Service Providers
all recruited on Performance-Based Contracts, and (ii) as and when needed, other service
providers to support project implementation at the local level; and (b) NARO shall
employ a chief information officer with qualifications, experience and terms of reference
satisfactory to IDA to support the coordination and oversight of the Project ICT activities.
(iv) The Recipient shall, not later than September 30 of each Fiscal Year, and under terms of
reference satisfactory to IDA: (a) carry out a detailed performance audit of NARO and
NAADS on a sample basis. To assist in carrying out each such performance audit, the
Recipient shall employ an independent firm with terms of reference and qualifications
and experience satisfactory to IDA; and (b) conduct a joint annual review of the Project
with IDA and Co-financiers, as well as NARO and NAADS, no later than May 31 of
each year.
(v) The Recipient shall, not later than November 30, 2010 or any other date agreed with IDA,
under terms of reference acceptable to IDA, update its ongoing assessments of local
government financial management capacity to include key financial management and
governance indicators that will form the basis for a determination of allocations to
NAADS districts.
(vi) In order to facilitate the evaluation by the Recipient of the Project's impact, the Recipient
shall, not later than June 30, 2011 or any other date agreed with IDA, conduct a baseline
survey of the agricultural activities of households in project areas under terms of
reference acceptable to IDA.
(vii) The Recipient shall not later than December 31, 2010 recruit for the NAADS Secretariat
qualified and experienced professional staff under terms of reference satisfactory to IDA
and consistent with the revised NAADS organizational structure.
24
IV. APPRAISAL SUMMARY
A. Economic and financial analyses
96. Investments in agricultural research and extension (R&E) have yielded high
returns. Analyses of the internal rates of return (IRR) on R&E investments across the world
between 1953 and 1997 give estimates in the range of 40­60 percent per year (IFPRI meta-
analysis, 2000). A recent study demonstrates that agricultural research in Sub-Saharan Africa has
an impressive aggregate IRR of 55 percent, while the rates of return on individual commodity
research and extension investments have been in the range of 30­40 percent (Alene and
Coulibaly 2008). For Uganda, the estimated IRR on past agricultural R&E investments was 65
percent. The average elasticity of productivity with respect to agricultural research is 0.38, while
the elasticity of GDP per capita with respect to productivity is estimated at 0.95, and the poverty
elasticity of per capita GDP is ­0.60. Returns to research subsume investments in dissemination,
since it is through dissemination that adoption occurs.
97. ATAAS-supported investments are expected to result in farm benefits through
multiple channels. These include: (i) an increase in farm yields; (ii) shifts to higher-value (and
more profitable) enterprises; and (iii) increased farm prices due to improved quality, farmers'
improved bargaining position, greater agricultural commercialization, and strengthened
agribusiness. The minimum incremental benefit stream is estimated to justify the proposed
investment in agricultural research, extension, farmer empowerment, and agribusiness services
under the project using a threshold (minimum) IRR of 12 percent. The analysis (detailed in
Annex 10) indicates this would require a supplementary annual farm yield increase of 0.7
percent per year, accounting for the impact of total factor productivity and increased intensity in
input use. If the impacts of better farm prices and shifts to more profitable enterprise mix are
taken into account, the required yield growth is estimated at 0.35 percent per year to attain the
threshold rate of return. Compared to the baseline, this is equivalent to a cumulative growth in
national average yield of just 7 percent over 20 years, which is a quite achievable target for
research and advisory service expenditure in Uganda. Sensitivity analyses were performed, and
the analyses and conclusions remain robust (see Annex 10).
98. Fiscal impact: The annual public expenditure on agricultural research and advisory
services (R&E) in Uganda was about UShs 129 billion between 2007/08 and 2009/10. This
represented 50 percent of the agriculture sector budget and about 2.1 percent of the government
budget. According to current MTEF projections, R&E spending from GoU's own budgetary
resources would grow from the current Uhs 147 billion to UShs 284.4 billion by 2014/15,
bringing its share in the total sector budget to 63 percent. As a share of total government
expenditure, R&E would still account for only 2.6 percent by 2014/15. Total ATAAS costs
financed by DPs are estimated at US$ 168.2 million over five years (or the equivalent of UShs
350 billion at UShs 2,081 per US$ 1). With the donor financing, the share of agricultural R&E in
the government budget would increase to 3.2 percent. The fiscal impact of such an increase is not
substantial, given the economic and social benefits that the proposed project would bring to
Uganda and the public nature of most services provided under ATAAS (see above).
25
B. Technical
99. The project is largely institutional in its objectives, but it also responds to the major
technical constraints affecting agricultural productivity growth. It proposes a number of
interventions to improve the efficiency of the country's solid network of research, advisory
services, farmer empowerment, agribusiness development, and market and community-based
organizations towards enhancing productivity and incomes. The following specific technical
issues will need priority attention: (i) seed of improved varieties and intellectual property and
patenting rights; (ii) land tenure and use; (iii) broader use of sustainable and integrated soil water
and fertility management, including conservation farming, to cope with climate variability and
land degradation; and (iv) use of pesticides and their impact on humans and the environment.
The GEF-supported activities will also address various SLM issues within the broad framework
set out by the CAADP pillars I and IV.
C. Fiduciary
100. Financial Management (FM). To ensure that the project is effectively implemented,
NARO, NAADS, and LGs will have to ensure that appropriate staffing arrangements are
maintained throughout the life of the project. The conclusion of the assessment is that the (FM)
residual risk rating of the program is substantial. The FM arrangements, with the proposed
actions and mitigating measures to strengthen the arrangements, meet IDA's minimum
requirements under OP/BP 10.02. The FM arrangements are adequate to provide, with
reasonable assurance, accurate and timely information on the status of the project required by
IDA (see details in Annex 7).
101. Procurement. Procurement under the project will follow the Guidelines: Procurement
under IBRD Loans and IDA Credits (May 2004, revised October 2006, and May 2010) and
Guidelines: Selection and Employment of Consultants by World Bank Borrowers (May 2004,
revised October 2006, and May 2010). Assessments of the capacity of the national implementing
agencies to undertake procurement activities were carried out by IDA June 2009 to December
2009. The assessments reviewed the organizational structure and functions, past experience, staff
skills, quality and adequacy of supporting and control systems, and legal and regulatory
framework. The residual risk for procurement after mitigation is substantial.
102. The national legislation on public procurement as laid out in the Public Procurement and
Disposal of Assets Act is generally consistent with the World Bank's guidelines, except for some
provisions that will be addressed during the ongoing exercise of revising the law with support of
the PRSC. The exceptions are listed in Annex 8. At the country level, the major country
procurement risks are: (i) limited compliance with the Act as indicated in audit reports from the
Public Procurement and Disposal Authority (PPDA), and (ii) the inadequate capacity and
experience in the implementing entities to conduct procurement. This risk will be mitigated by:
(i) IDA's monitoring through prior review and post review of contracts and supervision missions,
and (ii) training of the procurement staff in the implementing agencies under the project.
103. Procurement for the project at the national level will be conducted by the NARO and
NAADS Secretariats, for whom procurement capacity has been built under the predecessor IDA-
supported projects. The key risks are: (i) slow processing of procurement and (ii) limited
26
experience in the selection of consultants and procurement of information systems using IDA
procurement procedures; and (iii) the inadequate structure of the NAADS Secretariat
Procurement Unit to conduct procurement and support and monitor the decentralized
procurement. These risks shall be mitigated by: (i) continued training of both NARO and
NAADS in procurement; (ii) strengthening of the Procurement Unit at the NAADS Secretariat;
and (iii) augmenting the NARO and NAADS Procurement Units with support in the procurement
of information systems. The other risks and mitigation measures are indicated in detail in Annex
8. At the community and subcounty levels, the key risk for procurement is elite capture of the
procurement committees, resulting in collusion and, in turn, over-pricing and partial deliveries to
the beneficiaries. This risk shall be mitigated by: (i) providing regular market prices for
commonly procured items; (ii) publishing procurement decisions by these committees on the
procured items and the prices at which these are procured; and (iii) an annual technical and
performance audit of procurement and implementation at the subcounty and community level.
D. Social
104. ATAAS is expected to yield substantial positive social impacts, including increased
empowerment and improvement in livelihoods. These impacts are expected to emanate from
project activities related to outreach, technology dissemination, and the quality agricultural
services. The project is expected to improve livelihoods and enhance food security by increasing
crop and livestock yields, diversifying enterprises on and off of the farm, and adding value to
farm produce. By supporting agribusiness development and the development of entrepreneurial
skills, the project will also have multiplier effects on the local economy. The project will follow
a participatory and inclusive process of direct and systematic engagement with both beneficiary
and affected communities in the selection, implementation, and monitoring of its activities.
105. The project aims to make AASPs accountable for services delivered to the clients,
and provide opportunities for both male and female farmers to provide feedback on both
agricultural technologies and advisory services. Gender issues are included in NAADS activities,
in particular the formation of farmer groups and thus access to advisory services. Gender issues
will be considered explicitly in designing training programs and disseminating technologies, and
they will be monitored. Other social issues relate to how resource-poor farmers can get better
access to advisory services, inputs, and foundation seed for multiplication, and how to cope with
the impact of HIV/AIDS on household production systems. These issues are addressed in the
project design through the provision of matching grants for the adoption of new agricultural and
livestock production technologies. This will promote the social development outcomes of
inclusion and cohesiveness for improved agricultural services delivery and the progress will be
monitored in Annex 3.
106. ATAAS is not expected to have any negative social impacts. The project will not
involve any land acquisition or involuntary resettlement, since the implementation of program
activities will take place on existing research stations or farmers' lands. NARO has an acceptable
proof of ownership of the land to be used for project objectives, and encroachers, if any, will be
given notice to leave/harvest their crops prior to the starting of construction work. The
Environment and Social Management Framework (ESMF), developed and disclosed, provides a
strategic guide for integrating social considerations into the planning and implementation of
27
subproject activities. The ESMF will guide the initial screening of negative social impacts of all
subprojects and development of their mitigation measures (Annex 12).
E. Environment
107. ATAAS is expected to have positive environmental impacts through its focus on
promoting environmentally-sound production practices. In particular, ATAAS will have
positive environmental impacts through the promotion of SLM practices. The SLM program that
the project will implement will also contribute to increasing farmers' resilience to climate
change. Importantly, increased agricultural productivity through more intensive technologies
should reduce the extensification pressures on agriculturally marginal lands. Finally, ATAAS
will also support sound environmental management in the agricultural sector by integrating
environmental management and compliance considerations into the repertoire of AASPs (for
example, with respect to environmental regulations stipulating protection of wetlands and forests
from encroachment and degradation, including from agriculture).
108. ATAAS is also expected to have limited adverse environmental impacts. Some
ATAAS activities--such as the planned civil works in NARO, the agricultural intensification
technologies (pesticides and fertilizers) promoted by NAADS, and the generation of laboratory
waste from the research program--may potentially adversely affect surrounding habitats and
environs. These impacts are expected to be site-specific and readily manageable through
commonly available mitigation measures, such as sound construction practices and good practice
in handling and applying agrochemicals. To ensure that potential environmental impacts of
ATAAS are managed adequately, specific ATAAS activities will be screened for their potential
environmental (and social) impacts following the guidance in the ATAAS ESMF, and
appropriate mitigation measures will be developed and implemented. To enhance environmental
sustainability at the sector level, a Strategic Environmental Assessment of the sector and its
Sector Investment Plan will be prepared during project implementation with a view to inform
subsequent phases of sector development.
F. Safeguard policies
109. Based on the potential for limited adverse environmental impacts, ATAAS is rated
as EA Category B. It triggers two safeguard policies: (i) Environmental Assessment (OP/BP
4.01) and (ii) Pest Management (OP 4.09). To ensure compliance with IDA's and GoU's
environmental and social safeguards, an ESMF has been prepared. The ESMF includes an
Integrated Pest Management Framework (IPMF). The ESMF and IPMF provide a step-by-step
description of how to identify potential adverse impacts of specific ATAAS activities, plan
mitigation measures, and implement and monitor them (Annex 12). An ESMF was cleared by the
National Environmental Management Authority and IDA. The ESMF was disclosed in Uganda
and the World Bank's InfoShop in January, 2010. The revised final ESMF was disclosed in both
Uganda and the World Bank's InfoShop in April, 2010. The proposed prevention and mitigation
measures, together with their monitoring plans, form an integral part of the project's design and
costs. The ESMF preparation was informed by consultation with key stakeholders, and the
record of consultations is included in the ESMF.
28
110. To ensure that the capacity to implement the ESMF is adequate, ATAAS implementers
will be trained to use the ESMF early in the project effectiveness period. Additional technical
assistance will be provided as necessary during project implementation for screening ATAAS
activities or monitoring the implementation of mitigation measures to ensure close adherence to
the ESMF safeguard policies.
Safeguard Policies Triggered by the Project Yes No
Environmental Assessment (OP/BP 4.01) [X ] []
Natural Habitats (OP/BP 4.04) [] [X ]
Pest Management (OP 4.09) [ X] []
Indigenous Peoples (OP/BP 4.10) [] [ X]
Physical Cultural Resources (OP/BP 4.11) [] [ X]
Involuntary Resettlement (OP/BP 4.12) [] [ X]
Forests (OP/BP 4.36) [] [ X]
Safety of Dams (OP/BP 4.37) [] [ X]
Projects on International Waterways (OP/BP 7.50) [] [ X]
Projects in Disputed Areas (OP/BP 7.60)* [] [ X]
G. Policy exceptions and readiness
111. The project complies with all applicable IDA policies. A Project Preparation Facility
in the amount of US$ 3,000,000 was used to support key studies and capacity building for the
preparation of the project. In terms of readiness, the GoU, particularly the NARO and NAADS
Secretariats, are in a position to implement ATAAS. On the conditions of project effectiveness,
the Government is drafting the subsidiary agreements for NARO and NAADS. The revised
organizational structure for the NAADS Secretariat has been approved by the NAADS Board
and is awaiting approval by the Minister for MAAIF. NARO and NAADS Secretariats have a
draft Project Implementation Manual and Procurement Plans for the first 18 months. These were
discussed during the appraisal mission and will be finalized by July 1, 2010. The GEF Grant
Agreement will become effective at the same time as the ATAAS Credit.
112. On an exceptional basis, the effectiveness period for ATAAS has been extended to
120 days from the date of Board Approval instead of the standard 90 days because of potential
delays in Parliamentary approval processes ahead of the upcoming elections. To allow a timely
start up of project activities from July 1, 2010, the project will retroactively finance eligible
expenditures incurred on or after July 1, 2010, up to a maximum of US$ 15,000,000.
113. The co-financing agreements for all DPs are expected to be effective by March 31,
2011. The IFAD Loan is expected to be signed soon after its approval by the IFAD Executive
Board with the funds becoming available with the declaration of effectiveness of the IDA Credit.
The European Union's contribution, to be administered by IDA through a trust fund
arrangement, is expected to be in place by March 31, 2011 at the latest. Danida will reallocate
funds for ATAAS from an existing approved program through an addendum in agreement with
the GOU, and this will be done on the effectiveness of the IDA Credit.
*
By supporting the proposed project, the Bank does not intend to prejudice the final determination of the parties'
claims on the disputed areas.
29
114. A detailed implementation support strategy will be developed on the approval of
ATAAS. ATAAS will be implemented according to agreed annual work plans and budgets
laying out the program of activities to be carried out in the following fiscal year. Give the scope
of the project and the substantial level of residual risks, intensive supervision of the project is
planned. The estimated supervision budget for the project is US$150,000 a year.
30
Annex 1: Country and Sector or Program Background
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
1. Agriculture is a key sector of the Ugandan economy and features prominently among the
top five priority areas for public sector investment in the country's new five-year strategic
framework for economic development, the NDP.14 It is also the centerpiece in the Prosperity for
All Program, the vision driving the NDP based on the political manifesto of the current National
Resistance Movement (NRM) Government. Recent analytical work highlights agricultural
growth as a key determinant in the country's efforts to reduce poverty in the immediate years
ahead. It is within this framework that the new DSIP for the agricultural sector is being designed
by MAAIF. The DSIP envisages a comprehensive SWAp aligned with the principles and
aspirations of the CAADP, which has been endorsed by African governments, including the
GOU. The DSIP will focus on four main intervention and investment areas, namely: (i)
enhancing agricultural production and productivity; (ii) improving access to and sustainability of
markets; (iii) creating an enabling environment for the agricultural sector; and (iv) undertaking
agricultural sector institutional reforms and development.
2. Uganda is increasingly seen as a potential breadbasket for East Africa. Declining poverty,
relatively stable food prices, and rising food exports indicate a robust food crops sector, in
contrast to the stagnant performance of the sector as a whole in recent years. This conclusion is
corroborated by findings from two NAADS evaluation surveys, which show an increase in
median real wealth per capita of about 10 percent (across all households surveyed) between 2004
and 2007, with poorer households doing relatively better than the better-off households (see the
Working Document 1 in Annex 14) . Similarly, the real gross value of agricultural production
increased between 2004 and 2007 by 124 percent, and yields increased by 20 percent for maize,
12 percent for sweet potato, 9 percent for groundnuts, and 24 percent for millet--although yields
have decline for sorghum (12 percent), banana (7 percent), and beans (32 percent).15
3. Nevertheless, significant agricultural potential remains unutilized. Despite the progress
made, agricultural productivity and commercialization remain low for most smallholders--
frustrating the full realization of the productive potential of agricultural innovations. A number
of factors reinforce each other to keep agriculture at a low equilibrium. Low productivity reduces
enterprise profitability, making agriculture uncompetitive. Limited use of improved technology,
poor infrastructure (resulting in high transport and energy costs ), lack of business skills in the
sector, and poor integration of smallholders, particularly the poor and women farmers, into
markets and value chains limits the choice and profitability of enterprises, constraining
household incomes.
4. In the last 30 years, real output growth was driven mainly by the expansion in land area
and in the labor force. A recent study estimates growth in total factor productivity to have been
negative between 1991 and 2006, reflecting the declining contribution of inputs to agricultural
14
The sector contributes nearly 20 percent of GDP, accounts for 48 percent of exports, and provides a large
proportion of the raw materials for industry. Food processing alone accounts for 40 percent of total manufacturing.
The sector employs 73 percent of the population aged 10 years and older.
15
The NAADS evaluation surveys are not nationally representative; however, the findings provide some insight into
the performance of agriculture in the sampled area.
31
output.16 Opportunities for opening new land to agriculture are much reduced from even 10 years
ago, and the rapidly growing population17 requires more food at lower prices. For most outputs,
yields are still low. These trends vividly highlight the need for productivity-inducing public
investments. Although farm yields are unlikely to reach the levels attained on research stations,
they can certainly reach the levels attained by early adopters of improved low-input and high-
input technologies promoted by NAADS and others, in particular the USAID and Danida
projects. Overall, significant agricultural potential remains unrealized.
5. The problem of low yields in Uganda is worsened by additional risks from climate
variability and land degradation. Average temperatures in Uganda are likely to increase by up to
1.5 degrees Celsius (DfID 2008). Uganda's climate may become wetter on average, with rains
occurring as extreme or more frequent periods of intense rainfall (see Working Paper 4 in
Annex 14). There are likely to be changes in the frequency or severity of extreme climate events
such as heat waves, floods, storms, and droughts; some of this variability is already experienced
by farmers, who according to recent analytical work (2009) are keenly aware of a more variable
climate. Droughts, for example, have increased in frequency since 1965.
6. Sub-Saharan Africa loses considerable soil fertility through inadequate nutrient
management (see Working Paper 4 in Annex 14), and in Uganda this problem is particularly
pronounced. It can be remedied only through a strategic application of organic and inorganic
fertilizers, which can have a synergetic effect termed integrated nutrient management. Farmers
are responding to degraded soils and the effects of climate change with improved land
management measures, which include mulching, organic soil amendments, soil and water
conservation structures, and improved land and water use.
7. The precise impact of climate change in Uganda remains uncertain and projections differ
among climate models, but all recent forecasts agree that yields will probably decline. Soil
erosion and infertility hotspots have been identified in the southwestern highlands, Lake Victoria
Crescent, the northwest, and the eastern highlands. In these areas it is estimated that nitrogen,
potassium, and phosphorous balances have been declining 85, 75, and 10 kilograms per hectare
per year respectively. Soil erosion is estimated to exceed 5 tons per hectare per year (World
Bank SLM PER 2008). These constraints are expected to be amplified by current climate
variability and future increases in temperature, if business continues as usual. Thus climate
change and land degradation place challenging demands on agricultural productivity. They have
significant implications for water resources, food security, forests, natural resource management,
human health, and infrastructure in Uganda's diverse agricultural landscapes, and they have the
potential to halt or reverse the country's development and growth.
8. The low-cost measures taken by farmers to address constraints of low productivity, land
degradation, and climate variability can be advanced by stronger extension and research services.
What are the major constraints to the adoption of improved technologies and an accelerated
agricultural commercialization in Uganda? They include: (i) high transport and energy costs; (ii)
limited of awareness of farming as a business; and (iii) weak linkages of small farmers with
16
See Fuglie, K. (2009): Agricultural Productivity in Sub-Saharan Africa, Economic Research Service of the
United States Department of Agriculture, Washington, DC.
17
With a population growth of 3.2 percent per annum, Uganda has the third-highest rate of population increase in
the world.
32
value chain actors and rural financial institutions. Transport costs in rural areas remain high in
Uganda, in spite of the recent large increase in public expenditure for national and rural roads.
Transport prices on the international road from Mombasa to Kampala average US$ 0.08 per ton-
kilometer, which is twice as much as in Brazil, China, France, and the United States. Yet
transport prices are even higher on national roads. Average transport prices on tarmac roads are
about US$ 0.12­0.15 per ton-kilometer, while on feeder roads they reach US$ 0.3­0.4 per ton-
kilometer.18 High transport prices inflate input prices and depress output prices at the same time,
discouraging farmers from adopting input-intensive technologies. Transport prices are of lesser
constraints for high-value crops such as cotton, coffee, fruits, and vegetables, but they are a
major constraint for producing and marketing bulk commodities, especially staple food crops.
9. Agricultural commercialization and agribusiness in Uganda are also hampered by high
energy prices and power outages. Power outages and rolling blackouts raise production costs for
processing companies and flower farms forced to operate standby generators powered by costly
imported diesel for extended periods. The value lost from power outages in Uganda reaches 10
percent of sales, an extremely large share compared to the average for Africa and China.19
10. The slow adoption of improved technologies is also caused by Ugandan farmers' weak
business culture and poor integration in value chains. Most farmers pursue subsistence
agriculture, even those who belong to producer groups supported by NAADS and other projects.
They are trapped in subsistence production, buying no inputs and participating in markets only
when they have some marketable surplus. The GoU and several development partners,
particularly Danida, USAID, and IFAD, have promoted agribusiness and agricultural
commercialization, and the proposed ATAAS would build on and link with these projects and
programs (see Working Paper 3 in Annex 14, which describes major programs for agribusiness
in Uganda). Yet the impact of these efforts remains small, partly because they are fragmented
and partly because NAADS had only a moderate impact on strengthening farmer organizations
and linking them with value chain players during its previous phase.
11. Access to rural finance remains low for the vast majority of farmers. The demands of
many commercial farmers for short-term financial services are met; their main challenge is to
access longer-term finance and insurance. Subsistence farmers (more than three million
households) are the most numerous farmer group and present a far greater challenge to the
supply of financial services. Rural villagers who do not produce enough for the market also need
finance,20 and more efficient screening techniques are needed to identify creditworthy borrowers
of seasonal finance.
12. Banks primarily finance large agricultural entities. Only 13 percent of agricultural loans
are estimated to be provided by banks and other formal financial institutions. Although bank
branch networks have increased in recent years, their relevance to small and dispersed
agricultural production and marketing is likely to continue to be limited. Two banks that are
particularly active in providing agricultural finance are Centenary Rural Development Bank and
DFCU Bank, both of which use an agricultural guarantee fund provided by Danida. This fund
18
World Bank (2009): Eastern Africa: A Study of the Regional Maize Market and Marketing Costs, Report No.
49831-AFR, Washington, DC.
19
World Economic Forum (2010): Africa Competitiveness Report 2009. Joint publication of the World Economic
Forum, World Bank, and African Development Bank.
20
Meyer et al. (2004), Agriculture in Uganda: The Way Forward, Financial System Development Program Series
No. 13, SIDA/GTZ/BoU/KfW.
33
guarantees 50 percent of what the banks lend to agriculture and it has performed well since it
was established.
13. Informal sources play an important role in the provision of inputs. Funding for purchase
of seeds and fertilizers is mainly from informal financial groups and other informal sources in
rural areas. Nearly two-thirds of financing for agricultural purposes in rural areas, and nearly all
of the agricultural financing in urban areas comes from informal financial groups.
14. Microfinance institutions (MFIs) and savings and credit cooperatives (SACCOs) have
mixed performance records. MFIs make mostly short-term loans, often with group guarantees
and frequent payment schedules. This type of financing is better suited to trading enterprises
with high turnover and not to farming enterprises with more irregular and seasonal cash flows.
Some MFIs in rural areas have experienced rapid growth and high loan recovery rates,
demonstrating a demand for services in these areas. SACCOs also provide agricultural finance in
rural areas, but their performance must improve if they are to play a broader role in the sector.21
15. Although leasing has a long history in Uganda, leasing of agricultural machinery and
equipment has been limited. Leasing affords the lessee the advantage of possessing the asset to
generate revenue without paying for it immediately. The asset becomes the collateral, and the
farmer gets the benefit of using a productive asset without necessarily owning it. 22 However, tax
treatment of leasing is one of the many factors that have inhibited its growth in Uganda.
16. Against this background, it is clear that to overcome the constraints on increased
agricultural productivity and accelerated commercialization, a concerted effort is required of the
government, private sector, and development partners. In recent years, the GoU and development
partners have given considerable attention to creating an environment for increased
commercialization. Through a series of Poverty Reduction Support Credits (PRSCs), IDA has
supported the development of a more conducive policy environment for business, including the
improved management of public finance. The business climate has also improved through
interventions of the Presidential Investors' Round Table Initiative, the Private Sector
Development Project II, and other interventions (see Working Document 3 in Annex 14). The
NDP has identified physical infrastructure as a key binding constraint to growth. In a clear shift
of policy from the previous development strategy, starting in 2006/07 the GoU has significantly
stepped up its investments infrastructure, staring with energy, and moving on to roads and ICT
infrastructure with support from IDA and other development partners. The NDP has also
identified inadequate physical infrastructure as a key binding constraint to growth. The 2009
PER developed a framework for sustainable and efficient expenditures on rural road
infrastructure in Uganda. The framework gives priority to connecting rural areas with high
agricultural potential and supporting intermediate modes of transport in rural areas. Lower
transport costs and prices can be expected in Uganda, including its rural areas, and will have a
tremendous positive impact on agricultural growth and commercialization.
17. At the micro level, the integration of farmers, particularly smallholders and the poor, into
value chains remains a high priority for investment. Inability to link to markets and weak value
chains fail to provide incentives to farmers to adopt improved technologies and pursue more
commercial agriculture. Many farmers remain trapped in subsistence production, buy few inputs,
have not been able to acquire adequate business skills, and participate in the market only when
21
See the World Bank (June 2009): Making Finance Work in Uganda, Economic and Sector Work (draft).
22
Leasing and Agricultural Finance, policy paper, FSD Programme (SIDA, GTZ, BoU, and KfW).
34
they occasionally produce a surplus. The GoU and several development partners, in particular
Danida, USAID, and IFAD, have been promoting agribusiness and agricultural
commercialization (Working Document 2 in Annex 14). The impact of these efforts remains
small, partly because they have been either limited in scope or fragmented. The proposed
ATAAS Project would build on and link with these projects and programs to promote more
robust development of value chains.
18. The GoU has undertaken far-reaching reforms to build innovative institutions for
delivering agricultural technology services. In 1992, NARO was established as the key agency to
guide and consolidate agricultural research. In 2005, the NAR Act significantly reformed
NARO, transforming it from a predominantly public into a more pluralistic institution mandated
to coordinate the broader NARS. The expanded NARS includes a broader cross-section of
stakeholders and non-public research ARSPs. The reforms also sought to establish more client-
responsive research services by decentralizing the research system and separating research
funding from service provision. The establishment of semi-autonomous NARIs and ZARDIs,
responsible to their own multi-stakeholder Management Committees, was a signal achievement.
The NAADS were established through the NAADS Act (2001) as a key pillar of the Plan for the
Modernization of Agriculture to improve farmers' access to knowledge and enhance agricultural
productivity. Its institutional design was a response to the failure of the traditional, costly, and
ineffective extension system. Based on the principles of farmer empowerment, decentralization,
and subsidiarity, NAADS sought to fundamentally reform extension service delivery to a more
demand-driven and farmer-owned and accountable extension system. NAADS was conceived as
25-year program of institutional development, to be implemented in phases until it reached full
institutional and financial sustainability.
19. Past investments in technology services have yielded significant physical and institutional
development outcomes. IDA, along with other development partners, has been a major supporter
of both NARO and NAADS since their inception. The physical outcomes and impact of NARO
and NAADS are well documented (see Working Document 2 in Annex 14). Both institutions are
recognized as pioneers in institutional design in the region.
35
Annex 2: Major Related Projects Financed by IDA and/or other Agencies
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
Sector Latest supervision (ISR) ratings
Project (IDA-financed projects only)
IDA-Financed Implementation Development
Progress (IP) Objective (DO)
Uganda Second Agricultural Research and Training S S
Project (closed in June 2009)
National Agricultural Advisory Services (closed MS MS
in December 2009)
Program for Control of Avian Influenza U U
Energy for Rural Transformation APL II S S
Road Development III S S
Northern Uganda Social Fund II S S
Private Sector Competitiveness Project II MS MS
Eastern Africa Agricultural Productivity Program N/A N/A
APL1 ­ Kenya, Ethiopia, Tanzania, and Uganda
(approved for Uganda on June 11, 2009)
Multi-donor ASARECA Trust Fund (effective N/A N/A
January 2008)
Multi-donor CAADP Trust Fund N/A N/A
Note: Ranking for IP/DO: HS (highly satisfactory), S (satisfactory), MS (moderately satisfactory), U (unsatisfactory), and HU
(highly unsatisfactory). N/A: not applicable.
36
Annex 3: Results Framework and Monitoring
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
Table 3-A: Results Framework
PDO Project Outcome Indicators Use of Project Outcome
Information
PDO
To increase agricultural (i) Percentage increase in average Increase in agricultural incomes are
productivity and incomes of agricultural yields of participating expected from increased agricultural
participating households by households (by gender) productivity, either with higher yields
improving the performance of (ii) Percentage increase in agricultural or a shift to higher return enterprises,
agricultural research and income of participating households (by and increased share of the value of
advisory services in the gender) output marketed.
Republic of Uganda.
GEO
To enhance the environmental (iii) Additional hectares and kilometers Steady increase in area under SLM
sustainability and resilience of of land area with improved land and implies enhancement of
agricultural production to land water management practices environmental sustainability
degradation and climate risks.
Intermediate Outcomes Intermediate Outcome Indicators Use of Intermediate Outcome
Monitoring
Component 1: Developing (iv) Percentage increase in the number To establish the efficacy of the
Agricultural Technologies and of technological innovations generated research system in generating new
Strengthening the NARS for dissemination technology and innovations
(v) Number of collaborative research To establish the progress in
projects implemented a collaboration on technology
development through CRGTs
Component 2: Enhancing (vi) Percentage of the same To assess the extent of synergies in
Partnerships between commodities in ten top priorities for prioritizing research/extension
Agricultural Research, ZARDI and NAADS (by AEZ) activities in annual work programs
Advisory Services, and other
To measure the progress in
Stakeholders (vii) Proportion of the districts with the strengthening
operational District Adaptive Research research/extension/farmer linkages
Support Teams
Component 3: Strengthening (viii) Direct project beneficiaries To establish the number of project
the NAADS (number), of which female (%) direct and indirect beneficiaries
(ix) Indirect project beneficiaries
(number), of which female (%)
To assess the extent of dissemination
(x) Number of technologies and access to information on
demonstrated by the project in project agricultural technologies, including
areas (by enterprise) a SLM technologies
(xi) Percentage of targeted To measure the extent of use of
37
beneficiaries using improved project-supported agricultural
technologies (by enterprise, incl. SLM) technologies
(xii) Proportion of men and women
perceiving that their voice has been To assess progress in farmer
taken into account in decision making of empowerment
the farmer group
(xiii) Percentage of targeted To assess the quality of agricultural
beneficiaries who are satisfied with advisory service provision from the
advisory services (by gender) a beneficiary perspective
Component 4: Supporting (xiv) Share of farm production To establish progress towards
Agribusiness Services and marketed by targeted beneficiaries (in commercialization
Market Linkages value terms, by gender)
To monitor the progress in
establishing national PPPs
(xv) Number of operational PPPs for
agribusiness and market linkages
(xvi) Annual audit recommendations
implemented as a proportion of all
GAC indicators To monitor the implementation of the
actions recommended
GAC action plan
(xvii) The Complaint Handling
Mechanism for NAADS established and
functional
a
Indicators proposed by ARD to include in Core Indicators for Agricultural Research and Extension. The core indicator
Percentage of targeted clients (may include men and women farmers or businesses) who are members of an association
(includes producer association, cooperative, water user association, etc.) does not apply because the project will support only
farmers organized in farmer/producer groups. In this case, baseline and targets are 100 percent.
The monitoring and evaluation framework
1. The project will finance a results-based M&E system drawing on a number of
information sources, including: (i) existing data gathered and included in the NAADS and
NARO M&E databases; (ii) specially designed qualitative and quantitative household surveys;
(iii) extended data gathering on NARO research projects; and (iv) agricultural yields, farm
incomes, and other data collected by the Uganda Bureau of Statistics (UBOS). Household
surveys conducted by UBOS in collaboration with other GoU's agencies gather data relevant to
this M&E system, including data on farming activities and household expenditures (a possible
proxy for household incomes). Where possible, the project will seek the collaboration of GoU
bodies to add survey variables and data collection procedures to meet the project's needs. This
approach will create synergies between related data-gathering and survey efforts.
2. A customized management information system (MIS) will enhance the collection and
management of project data and other information. ATAAS will further develop the system
developed under ARTP II and NAADS I to allow the joint M&E activities. The MIS will
enhance overall project management by capturing information on project assets, annual work
plans, procurement plans, financial management, and monitoring the implementation of
activities. An improved MIS will help project management detect challenges early and make
38
appropriate adjustments. The MIS for the project will begin by linking NARO and NAADS
information management ultimately integrated into the MIS led by MAAIF.
The impact evaluation framework
3. The project's impacts will be evaluated by a recognized independent institution to ensure
objectivity and quality. The impact evaluations will rely primarily on data collected through
special household and beneficiary surveys in project areas. The surveys will be designed to
support a double-difference approach to evaluate and attribute project impacts. The surveys will
sample target and control groups and generate panel data on outcome indicators related to
income levels, well-being, and satisfaction with service delivery among stakeholders in the
project area. Additional data collection strategies will be implemented with regard to other key
performance indicators, such as levels of private and public investment in the agricultural sector.
4. Three surveys will be done--one at the start of the project, one at Mid-Term, and the
final at completion. The project M&E data will be a critical input into the evaluations. Whenever
possible, impact evaluations will supplement survey data from NARO, NAADS, and other
GoU's agencies. International best practices will be employed to ensure reliability and accuracy,
particularly in survey design, sample selection, statistical analysis, and interpretation. The
evaluations will use methods that compare target and non-target communities, which make it
possible to attribute specific outcomes to project interventions and identify any differences in
benefits among farm households and their possible causes.
Arrangements for results monitoring
5. Table 3-B summarizes the arrangements for M&E under the proposed project. NARO
and NAADS Secretariats will be jointly responsible for the strategic planning of project activities
and the monitoring of their results. A joint Steering Committee chaired by the Planning
Department of MAAIF and comprising the M&E and planning staff of NARO and NAADS, and
a representative from UBOS will oversee the implementation of M&E activities. The day to day
implementation of ATAAS M&E activities will be the responsibility of a joint team of NARO
and NAADS M&E staff led by the M&E officer from each organization for a period of two years
on a rotating basis. Both NARO and NAADS will need to strengthen their existing M&E cadres
to allow efficient and effective data gathering at all levels, and analysis and reporting on routine
and ad hoc bases. At an early stage of the Project, the joint implementation team might engage
an outside consultant to assist in assessing the readiness of NARO and NAADS to adopt a
comprehensive M&E regime, to mitigate any blockages and to align follow-on activities with
international best practice.
6. M&E functions in both organizations need additional personnel. NARO and NAADS will
need to supplement existing M&E personnel in the Secretariats by hiring staff. In addition, there
will be special emphasis on M&E capacity building through internal and external courses. The
capacity building would build on the existing one-week workshop on M&E Training for
Researchers in PARIs that NARO organized for 34 participants in June/July 2009. The
workshops will be conducted at regular intervals and target participants in the NARO/NAADS
Secretariats, and researchers at NARIs and ZARDIs. Further M&E capacity building
interventions will be targeted at M&E coordinators, service providers and all those responsible
for gathering of field data to raise the level of quality of data collection, and aggregation and
regular transmission to the M&E database.
39
Table 3-B: Arrangements for results monitoring
Target Values Data Collection and Reporting
Project Outcome Baseline YR1 YR2 YR3 YR4 YR5 Frequency and Data Collection Responsibility for
Indicators Reports Instruments Data Collection
1. Percentage increase in
average agricultural yield
of participating
households, cumulative
(a) crop yields
- Maize 1.5 t/h MTR and Survey/Impact NAADS, NARO,
- Rice 1.3 t/h 7% 15% Completion evaluation MAAIF, UBOS
- Beans 0.7 t/h
(b) livestock productivity
3 liters/day 8% 20%
- Milk production
- Poultry Eggs 220/bird
2.Percentage increase in
agricultural income of UShs MTR and Survey/Impact NAADS, NARO,
10% 20%
participating households, 4,120,000 Completion evaluation MAAIF, UBOS
cumulative
3. Additional hectares and
kilometers of land area
with improved land and 0 6,000 ha 11,000 ha MTR and Survey/Impact NAADS/NARO
water management 0 6,000 km 9,900 km Completion evaluation Secretariats
practices, cumulative (see
Table 3-D)
Intermediate Outcome
Indicators
4. Percentage increase in
the number of NARO
technological innovations 600 2% 5% 9% 14% 20% Annually Regular reports
Secretariat/MAAIF
generated for
dissemination, cumulative
5. Number of collaborative
NARO
research projects 0 58 58 108 58 58 Annually Regular reports
Secretariat/ZARDIs
implemented, annual
6. Percentage of the same MTR and Survey/Impact NARO, ZARDIs,
40
Target Values Data Collection and Reporting
Project Outcome Baseline YR1 YR2 YR3 YR4 YR5 Frequency and Data Collection Responsibility for
Indicators Reports Instruments Data Collection
commodities in ten top Completion evaluation NAADS
priorities for ZARDI and 10% 40% 75%
NAADS on average over
AEZ
7. Proportion of the
districts with the 0 30% 70% 100% 100% 100%
operational District
NARO/NAADS
Adaptive Research Annually Regular reports
Secretariats
Support Teams,
cumulative
8. Direct project
beneficiaries (in million), 0 1.15 1.29 1.43 1.57 1.71
cumulative, of which Annually Regular reports NAADS Secretariat
female (%)
0 50% 51% 52% 53% 54%
9. Indirect project
beneficiaries (in million), 0 0.72 0.85 MTR and Impact Evaluation
NAADS Secretariat
cumulative, of which 0 51% 51% Completion Surveys
female (%)
10. Number of
technologies demonstrated
by the project in project
areas, cumulative:
Annually Regular reports NAADS Secretariat
- Crop 28 28 30 33 37 40
- Livestock 16 16 17 19 23 25
- Fisheries 2 2 2 3 3 4
- SLM technologies 10 10 10 11 12 14
11. Percentage of targeted
beneficiaries using
improved agricultural
technologies:
- Crop
25% 40% 60% MTR and Survey/Impact
- Livestock NAADS Secretariat
12% 20% 35% Completion evaluation
- Fisheries
3% 6% 10%
- SLM technologies
2% 5% 10%
41
Target Values Data Collection and Reporting
Project Outcome Baseline YR1 YR2 YR3 YR4 YR5 Frequency and Data Collection Responsibility for
Indicators Reports Instruments Data Collection
12. Proportion of men and
women perceiving that
their voice has been taken
into account in decision MTR and Survey/Impact
making of the farmer evaluation NAADS Secretariat
Completion
group:
N/A 60% 75%
- Men
N/A 45% 65%
- Women
13. Percentage of targeted
beneficiaries who are Survey/Impact
satisfied with advisory MTR and evaluation
NAADS Secretariat
services Completion
- Men N/A 60% 75%
- Women N/A 40% 60%
14. Share of farm MTR and
25% 30% 35% Survey/Impact NAADS Secretariat
production marketed by
Completion evaluation
targeted beneficiaries
15. Number of operational
PPPs for agribusiness and
N/A 50 160 270 300 300 Annually Reports NAADS Secretariat
market linkages,
cumulative
16. Annual audit
recommendations
implemented as a
proportion of all actions NARO and NAADS
Reports
recommended Annually Secretariats
N/A 90% 95% 95% 100% 100%
- NARO N/A 90% 95% 95% 100% 100%
- NAADS
17. The Complaint
Handling Mechanism for
No Piloted Established Functional Functional Functional Annually Report NAADS Secretariat
NAADS established and
functional
42
Table 3-C: Definitions of Indicators
Indicator Definition
1 Percentage increase in average agricultural yields of participating The average yields for participating households. Participating households are defined as the members of the NAADS farmer
households: groups (see the indicator 8).
(a) Individual Crop Yields The average crop yield for maize, beans and rice . These crops are priorities for NARO and NAADS and commonly grown
in the country. The baseline data are national average yields between 2006 and 2008, reported by FAO, and will be updated
using the baseline survey.
(b) Livestock Productivity The average production per unit of livestock: milk (dairy) and eggs (poultry). These technologies are priorities for NARO
and NAADS and commonly produced in the country. The baseline data are the national average reported by NARO and
will be updated using the baseline survey.
2 Percentage increase in agricultural income of participating Average revenues of the participating households derived from crop and livestock activities less variable inputs (non-labor
households and non-capital inputs), based on an impact evaluation (cumulative). The baseline of 0 refers to income affected by ATAAS
and is the average for 2005/06 reported in UNHS (UShs 4,120,000).
3 Additional hectares and kilometers of land area with improved land New/additional land area in hectares that benefit from SLM practices (cumulative) promoted by NARO and NAADS and
and water management (SLM) practices adopted by farmers. This indicator will be assessed through the impact evaluation. The specific technologies are listed in
Table 3-D. The baseline of 0 refers to land area affected by ATAAS.
4 Percentage increase in the number of technological innovations Percentage increase of NARO technologies according to the NARO MIS (cumulative). Baseline equals 600 innovations at
generated for dissemination the end of 2009.
5 Number of collaborative research projects implemented Annual number of joint research projects of NARO institutions with universities, private sector, farmers, and other
stakeholders implemented through research competitive grants. The baseline of 0 refers to collaborative projects affected by
ATAAS.
6 Percentage of the same commodities in ten top priorities for ZARDI Share of the same commodities of ten top priorities in both ZARDIs and NAADS's annual work plans by agro-ecological
and NAADS on average over AEZ zone (cumulative)
7 Proportion of the districts with the operational District Adaptive Cumulative share of districts with the operational DARSTs to the total number of NAADS districts
Research Support Teams
8 Direct project beneficiaries (number), of which female (percentage) Number of Participating households defined as members of NAADS farmer groups who directly benefit from project
interventions. This indicator is calculated as the number of NAADS farmer groups multiplied by 25, the average number of
members per group, and assumes that each member represents one participating household. The share of benefiting female
is estimated as the number of female members of NAADS groups as a share of total number of NAADS beneficiaries. The
baseline of 0 refers to beneficiaries affected by ATAAS.
9 Indirect project beneficiaries (number), of which female (percentage) Indirect project beneficiaries are those households who benefit indirectly through observation or other spillover effects from
NARO and NAADS demonstrations, information dissemination and other project activities, including through expansion of
value chains and technology multiplication. It is assumed that for every two direct beneficiaries there will be at least one
indirectly benefiting household. The share of female in rural household was 51 percent in 2008 and it is assumed to remain
at that level over the project implementation period.
10 Number of technologies demonstrated by the project in project area Number of demonstrations of distinct technologies. Technologies are disaggregated for crop, livestock, fishery, and SLM
(cumulative): for crops they include improved varieties, pest management, post harvest and value addition; for livestock
they include breeds, disease control, food nutrition, cattle housing, and value addition; for fisheries, they include nutrition,
management, post harvest, and value addition; and for SLM, technologies are listed in Table 3-D.
11 Percentage of targeted beneficiaries who use improved agricultural Direct project beneficiaries who use improved technologies on their farm as a share of total number of direct project
technologies (by enterprise, inc. SLM) beneficiaries (cumulative), based on an impact evaluation
12 Proportion of men and women perceiving that their voice has been Share of targeted beneficiaries who regularly participate in the meetings of farmer groups and feel that they contribute to
taken into account in decision making of the farmer group decision making of their groups in total number of direct project beneficiaries (disaggregated by gender), based on an
impact evaluation
13 Percentage of targeted beneficiaries satisfied with agricultural Project direct beneficiaries satisfied with advisory services as a share of total number of direct project beneficiaries (gender
services disaggregated), based on an impact evaluation
43
14 Percentage increase in farm production marketed by the targeted Share of agricultural production marketed in the value of total farm production of the project beneficiaries (cumulative),
beneficiaries based on an impact evaluation
15 Number of operational PPPs for agribusiness and market linkages Cumulative number of established PPPs with private sector through matching grants under the Commercializing Challenge
Fund at the national level
16 Annual audit recommendations implemented as a proportion of all Share of recommendations of NARO and NAADS audits, on which actions were taken (GAC indicator 1)
actions recommended
17 The Complaint Handling Mechanism for NAADS established and The mechanism to handle complaints at sub-county, district, and national is established and the evidence provided that it is
functional fully functional (GAC indicator 2).
Table 3-D: Targets for SLM practices from improved extension
SLM practice Target: hectares or kilometers (depending on technology type) Agro-ecological zone (AEZ)
Terraces A total of 40 ha constructed as demonstrations and a further 400 ha stimulated Highlands zone
through advice and incentives
Contour bunds 125 km constructed as demonstrations and 1,250 km stimulated through advice Cattle corridor, Lake Victoria Basin, Eastern, and Northern
and incentives in each of the 4 AEZs (Cattle corridor, Lake Victoria Basin,
Eastern and Northern)
Grass bunds 100 km planted as demonstrations and 1,000 km stimulated through advice and Cattle corridor, Lake Victoria Basin, Eastern, and Northern
incentives in each of the 4 AEZs
Conservation agriculture (low-till) 50 ha established as demonstrations and 500 ha stimulated through advice and Eastern and Northern
incentives in both AEZs (Eastern and Northern)
Rehabilitation/reclamation of degraded watersheds 150 ha in each of the 4 AEZs Cattle corridor, Lake Victoria Basin, Eastern, and Northern
Agroforestry 75 ha planted as demonstrations and 750 ha stimulated through advice and Cattle corridor, Lake Victoria Basin, Eastern, and Northern
incentives per zone
Woodlots A total of 250 ha planted as demonstrations and 2,500 stimulated through Cattle corridor, Lake Victoria Basin, Eastern, and Northern
advice and incentives
Agronomic/vegetative SLM practices (mulching; Adopted on a further total of 5,000 ha as a result of advice--especially All AEZs
intercropping; rotations; integrated nutrient management; through field days
grassland improvement, and so on)
Small-scale irrigation (estimated improvements to a total 500 ha total in all four zones Cattle corridor, Lake Victoria Basin, Eastern, and Northern
500 ha)
Water harvesting (estimated total 100 micro-schemes N/A ­ variable Cattle corridor, Lake Victoria Basin, Eastern, and Northern
improved/ established)
SLM practice totals: Total hectares: 11,165 estimated
Total kilometers: 9,900 estimated
44
Annex 4: Detailed Project Description
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
1. The ATAAS Project is designed to support the implementation of the full national
programs of NARO and NAADS. The project will support key activities along the research-
extension-farmer-market value chain continuum through five components: (1) Developing
Agricultural Technologies and Strengthening the National Agricultural Research System; (2)
Enhancing Partnerships between Agricultural Research, Advisory Services and other
Stakeholders; (3) Strengthening the National Agricultural Advisory Services; (4) Supporting
Agribusiness Services and Market Linkages; and (5) Program Management. Research activities
(component 1) will be primarily the responsibility of NARO, while advisory services
(component 3) and agribusiness services (component 4) will be the responsibility of NAADS. A
number of activities require close collaboration and partnerships between NARO, NAADS, and
other stakeholders (component 2), and they will be implemented jointly and collaboratively.
Program management is also a joint responsibility and will be financed through the NAADS and
NARO Secretariats (component 5).
2. The detailed description of ATAAS activities is based on the NARP document prepared
by NARO Secretariat, the NAADS Core Document and Thematic Papers prepared by the
NAADS Secretariat, and the NARO-NAADS Partnership Framework prepared by NARO and
NAADS. These documents in turn are based on a number of detailed thematic papers,
background studies and reviews, and broad stakeholder consultative meetings (for details see the
relevant Project Files in Annex 14).
BACKGROUND
The National Agricultural Research Program (NARP)
3. NARP's goal is to enhance the contribution of research to food security, poverty
eradication, employment creation, and economic growth through sustainable agricultural
productivity gains and greater competitiveness of the agricultural sector. This goal will be
achieved through three strategic objectives: (i) to identify and generate technologies, practices
and strategies addressing stakeholders' demands and responding to market opportunities; (ii) to
establish an efficient and effective delivery and uptake of technology and knowledge within the
national agricultural innovation system; and (iii) to strengthen the capacity and effectiveness of
the Uganda's NARS. The ATAAS project components and subcomponents described below aim
at achieving these objectives.
NARO and Uganda's agricultural research policy
4. NARO was created in 1992 with a mandate to undertake, promote, and co-ordinate
research in all aspects of crops, fisheries, forestry, and livestock, ensuring dissemination and
application of research. The 2005 National Agricultural Research (NAR) Act transformed
NARO from a mainly public sector organization into a pluralistic national system encompassing
a cross-section of public and private ARSPs and sector stakeholders; the NARS is coordinated by
the NARO Council. The NAR Act provides the legal framework for: (i) a pluralistic NARS with
opportunity for all stakeholders to participate in agricultural R&D to enhance PPPs; (ii)
separation of research funding from research implementation to enhance equity in accessing
45
public funds for research and improve efficiency; (iii) the provision of research funding through
Competitive Research Grant Systems (CRGs) to all eligible NARS members to supplement
research funds and enhance innovation systems effectiveness and efficiency; and, (iv) semi-
autonomy of PARIs with national and zonal mandates that empower stakeholders to participate
in the governance of research processes, in resource allocation, and in demanding relevant
output. The Uganda NARS is one of the most advanced systems in Eastern and Central Africa. It
has played a pivotal role in sub-regional collaboration, as in the context of the Association for
Strengthening of Agricultural Research in Eastern and Central Africa (ASARECA), for which
Uganda is the host country. NARO, together with the NARSs in Ethiopia, Kenya and Tanzania
also implements the EAAPP, which was approved by IDA in June, 2009
5. The NARO Council recently endorsed a new Ten-Year Strategic Plan (2008/09­2017/18)
whose key principles are: (i) further decentralizing research services and reaching a better
balance between subsidiarity, stakeholder involvement, and the need to maintain a critical mass
of scientists; (ii) mainstreaming the Integrated Agricultural Research for Development (AR4D)
concept piloted during ARTP II in collaboration with Makerere University, NAADS, and the
International Center for Research in Agriculture (ICRA); (iii) strong interaction with key
stakeholders in R&D processes; (iv) enhancing the quality of service provision (aiming at
providing improved products and services to farmers); and, (v) developing and maintaining core
strategic programs to feed the development-oriented research programs at the zonal level. Based
on this strategy, NARO developed a five-year (2009­14) National Agricultural Research
Program (NARP) which is the basis for both EAAPP and the NARS component of ATAAS.
Regional and international collaboration
6. New agricultural technologies come from NARO as well as from surrounding countries
and other international sources, including international research centers, public research agencies
based in the region, private companies selling seeds and breeds, feed companies, and others. To
meet specific needs, such as emerging crop diseases and consumer preferences, NARO,
universities, and private companies will also locally adapt or further develop technology that
they source internationally. Closer sub-regional and international collaboration greatly improves
the NARS's delivery of productive technologies.
7. Through ASARECA and other contacts, NARO already cooperates with other countries
in the region in agricultural R&D. EAAPP enables selected programs within national research
systems to become RCOEs for research, training and dissemination of technologies and
information. EAAPP supports four RCOEs: one for rice in Tanzania, dairy in Kenya, wheat in
Ethiopia, and cassava in Uganda (at NARO's National Crops Resources Research Institute).
EAAPP also supports focal points for rice, dairy, and wheat research at the National Crops
Resources Research Institute, the National Livestock Resources Research Institute, and the
ZARDI at Bugginyanya, respectively; and adaptive research and dissemination in the four focus
commodities at several ZARDIs. At the regional level, ASARECA assists with EAAPP
management and coordination.
NARP research priorities
8. The DSIP lists twelve key enterprises that are priorities for rural development selected
largely on the basis of criteria developed by CAADP, such as returns to investment, export
46
potential, poverty and multiplier effects, and area devoted to the enterprise.23 The NAADS
priorities emerge from decisions at annual farmer fora at the sub-county and district levels and
are currently bound to the annual production cycle; the NAADS process also generally
encourages profitable enterprise mixes. Priority setting at NARO is based on agro-ecological and
socio-economic criteria, a synthesis of stakeholder demands from the sub-county to national
level, and identification of priority commodities, opportunities, and core constraints. The final
priority setting at NARIs and ZARDIs is based on needs assessments for zonal stakeholders,
NAADS-derived priorities, and the twelve DSIP development enterprises.
9. Under ATAAS, the priorities identified by the DSIP, NAADS, and ZARDIs will
interface closely at the zonal level. The ZARDIs and NAADS will participate in zonal and
national MSIPs for selected priority commodities to enable stakeholders to work together to
enhance value chain development. The ZARDIs will develop flexible research agendas that give
opportunities for scientists to deal with emerging development needs and opportunities for the
DSIP and NAADS focus enterprises. The DSIP may shift to new commodities annually, and the
research system will then address the technology needs for new enterprises without
compromising zonal priority research. Technologies for emerging opportunities that do not fall
within the zonal priorities will be developed through the CRG system or directly commissioned
studies. The ZARDIs will also adapt and demonstrate zone-specific technologies developed by
NARIs or adapted from RCoEs and/or international centers. They will in addition ensure the
availability of foundation technologies (such as seed, planting materials, and equipment) for the
various stages of value addition.
10. The ZARDIs will establish strong linkages with the District Subject Matter Specialists
(SMSs), the DARSTs and AASPs through MoUs. NARO's top priorities for national and zonal
research for 2009­14 include: (i) for crops: bananas, beans, cassava, coffee, cotton, groundnuts,
sorghum, sunflower, finger millet, maize, rice and horticulture; (ii) for livestock: cattle, goats,
poultry and honey; (iii) for capture fisheries and aquaculture: Nile perch, tilapia, and cat fish; (iv)
for forestry: timber, fuel, pulp and paper, shade/habitats in natural forests, plantations, and agro-
forestry; and (v) for thematic cross-cutting issues: gender; HIV/AIDS; marketing; natural
resource management and policy; SLM and adaptation to climate change; and mitigation of the
negative effects of invasive species.
11. The identification of opportunities and constraints guides the formulation of research
projects, which are then peer-reviewed to refine priorities in relation to human resource capacity
and funds. Ongoing research programs are reviewed annually and subjected to more critical
review every three years, which is an effective mechanism to capture emerging research
challenges and revise research directions if needed.
NAADS Phase II
12. At its inception in 2001, NAADS was envisioned as a 25 year program to be
implemented in several phases. During the first phase (2001­07), the program was extended to
all districts and subcounties in the country. The strategic framework for NAADS Phase I was: A
decentralized, farmer-owned, and public/private sector serviced extension system contributing to
the realization of agricultural sector objectives. The NAADS mission was: Increased farmer
access to relevant information, knowledge, and technology through effective, efficient,
23
Maize, rice, beans, citrus, cassava, Irish potatoes, dairy cattle, beef cattle, poultry, fisheries, coffee, and tea.
47
sustainable, and decentralized extension services coupled with increasing private sector
involvement in line with GoU's policy. The NAADS mission under ATAAS remains the same,
as reflected in the recent DSIP and NDP, and is based on the following core principles:
Participation, empowerment, and ownership through mechanisms that enable farmer
clients to access and control the structures and processes that transform their natural
resource assets into desirable outcomes. NAADS Phase I moved towards this goal by
organizing farmers into groups and associations, an effort that will be reinforced under
ATAAS by improved mechanisms.
Supporting and promoting PPPs in line with the GoU's overall framework for economic
development, which emphasizes PPPs as a key mechanism for funding and providing
advisory services and commercialization.
Promoting commercialization by supporting a range of mechanisms that enable farmers to
progress from a subsistence to a market orientation.
Pluralism in service delivery to cater for the needs of different categories of farmers, agro-
ecological areas, and socio-economic settings.
Strengthening the research­extension-stakeholder partnerships to ensure the generation
of technologies targeted more precisely to farmers' needs and accelerated dissemination.
Deepening and strengthening decentralization in line with the overarching policy of
moving political and governance structures nearer to the people.
Growth and equity in service provision to remove the gender, social, and geographical
disparities in the distribution of benefits from development programs.
Sustainable use and management of agricultural resources, especially in light of the need
to mitigate environmental degradation and the effects of climate change.
13. In summary, the general objectives of ATAAS components 3 and 4, for which NAADS is
directly responsible, and which are aligned with the NDP and DSIP--are to enhance the
efficiency and effectiveness of agricultural advisory services delivered within the framework of
the vision, mission, and principles of NAADS.
PROJECT COMPONENTS AND ACTIVITIES
COMPONENT 1: DEVELOPING AGRICULTURAL TECHNOLOGIES AND
STRENGTHENING THE NARS (US$ 137.8 million: US$ 104.0 million from GoU, US$ 25.2
million from IDA, and US$ 8.6 million from other DPs)24
Subcomponent 1.1: Technology Identification and Development
14. This component supports the implementation of NARP and will be complemented by
activities under EAAPP, which is currently targeting four commodities. Activities financed
under ATAAS will support the identification and generation of technologies, practices, and
strategies that meet stakeholders' demands and respond to market opportunities. National
strategic and ZARDI adaptive research programs will focus on the priority enterprises in the
DSIP, starting with support to ongoing research. CRGs will be expanded and will be managed
through recently revised guidelines to focus on research outcomes and impact. To avoid
24
NARO has also received about US$ 22.5 million of additional resources under EAAPP to implement R&D on
cassava (RCoE), dairy, rice and wheat (mainly NaCRRI, NaLRRI, and NARL).
48
duplication and foster synergies, the core national strategic priority programs supported under
ATAAS are closely coordinated with those financed through EAAPP. Cross-cutting research on
SLM as well as on mitigating the effects of climate change and variability will be supported
through a fully blended GEF fund. This subcomponent comprises two activities with specific
outputs.
Activity 1.1.1: Core national strategic and zone-specific research programs implemented.
15. All priority national strategic research programs will be coordinated by the respective
NARIs, which are mandated to conduct research on sub-humid crops, semi-arid crops, livestock,
fisheries, and forestry. If the NARIs lack the required expertise (as with some agro-processing
and market-related research), strategic program components will be outsourced to other ARSPs.
As indicated in the earlier discussion on regional and international collaboration, much
agricultural technology relevant to Uganda's farmers is available from sources other than NARO
itself. Local companies already identify and import vegetable seed, chicken breeds, and livestock
feed. Some Ugandan companies also provide technology to neighboring countries. Under
ATAAS, NARO, in close consultation with MAAIF Headquarters will continue to review and
where necessarily address any unnecessary constraints that impede the accelerated exchange of
knowledge and information on new practices, seeds and breeds between the key players in the
sub-region.
16. The ZARDI-specific programs are based on zonal priorities and include the adaptive
component for all other strategic programs. The national research system also requires the
capacity to respond to emerging constraints and opportunities--in other words, it requires
resources that are not dedicated explicitly to ongoing research. The environmental challenges
facing agricultural production, combined with the need for commercialization and
intensification, require a special national priority program. Research to mitigate the effects of
climate change includes25: (i) soil mapping and digitization; (ii) specific fertilizer
recommendations and integrated plant nutrient management practices for the main commodities
and soil types; (iii) SLM technologies; (iv) integrated pest and disease management; (v) research
to improve the understanding of climate change and variability, their impacts on agricultural
productivity, and ways to address those impacts; and, (vi) invasive species mitigation.
Activity 1.1.2: Additional research priorities effectively addressed through CRGs
17. The CRGs would be provided to eligible research entities to carry out specific
development projects consisting of research on non-strategic priority agricultural topics. The
CRGs will be expanded to: (i) increase the efficiency with which NARO harnesses its existing
national research capacity; (ii) promote PPPs in research26; (iii) improve access to funds by other
ARSPs; and (iv) speed-up the response to farmers' needs. The grant process will be managed
through recently revised guidelines to focus on research outputs, outcomes, and impact. The
competitive bidding process will include a call for proposals, peer review and evaluation. Grants
will be awarded through contracts and be subject to rigorous M&E. Priorities for CRG funding
25
GEF will finance some activities in climate change adaptation; the bulk of funding will come from GoU and IDA.
26
CRGs could for example also support and involve seed companies in indentifying and introducing new cultivars.
A call for proposals could challenge seed companies to identify, import, and test cultivars for priority crops from
Eastern and Central Africa and other countries with comparable agro-climatic conditions.
49
include emerging issues and relatively short-term research that may be attractive to the private
sector.
Subcomponent 1.2: Institutional Strengthening of NARO and other ARSPs
18. This subcomponent will strengthen the effectiveness and efficiency of the Uganda
NARS. Impact studies confirm that investments in agricultural research result in new knowledge,
enhance production and productivity, and have a high impact on increasing rural household
incomes thereby reducing poverty. Incremental investments are needed not only to generate
relevant technologies, practices, and strategies for agricultural development but also to facilitate
essential partnerships and collaboration that translate new knowledge into use as innovations and
mainstream quality assurance for intellectual goods and services. The NARS mandate includes
helping to implement GoU's policy to eradicate poverty through the Prosperity for All Program.
To respond more effectively to these demands, it is important to strengthen NARI and ZARDI
capacities. Institutional strengthening of the ZARDIs, particularly in Northern Uganda, will
receive special attention. The efficiency of NARIs will be improved, for example, by costing
services in business plans and charging users accordingly, as well as through recognizing and
quantifying the contributions of farmers, private ARSPs, and other private sector stakeholders to
research activities and programs.
19. This subcomponent will reinforce the human, financial, infrastructural, and
organizational capacity of the NARIs and ZARDIs, especially those established recently. The
subcomponent will also support operation of the CRGs by strengthening guidelines, processes,
quality control, and capacity building across the NARS. It will likewise support farmer and
stakeholder participation in the joint evaluation of research programs and services as well as
support participatory management structures. It will also address the availability of suitable
facilities, infrastructure, equipment, and national and international services required to
implement the agreed research agenda. Special emphasis will be given to the development of
linkages and networking between all constituents of NARO for improved information and
knowledge exchange, collective learning, pooling of resources and synergies, and empowerment
of weaker participants. NARO will also draw on ATAAS support to foster paradigm shifts in
areas such as IAR4D; market-oriented research; gender mainstreaming; and environmental
scanning for emerging issues ( for example, concerning climate change and biofuels). In
addition, EAAPP will provide a substantial complementary contribution to institutional capacity
development related to the four selected commodities. Finally, M&E and MIS systems will be
strengthened across the NARS in close alignment with NAADS.
20. A supporting and synergistic role is foreseen for ARSPs other than NARIs and ZARDIs
(universities, CSOs, and the private sector) in terms of bringing in new ideas, a market
orientation, and specialist knowledge and skills. Thus such service providers and other actors
will need to play a stronger role in NARO governance, and training programs to strengthen their
capacity in planning, implementing, and evaluating research programs and their participation in
CRGs. NARO Secretariat will review and where necessary adapt the Organization's human
resource development policy that sets priorities and makes strategic choices in view of the
limited number of established positions and available resources. PARIs have left part of their
administrative functions with the NARO Secretariat. A functional analysis of the NARO
Secretariat and other NARO constituencies will therefore be done to identify needs and develop
recommendations on how these can be addressed. NARO Secretariat will also develop and
50
implement a NARS-wide capacity and competencies development program for market-oriented
research, environmental issues, gender mainstreaming, and working in multi-institutional and
inter-disciplinary teams.
21. NARO will in addition be assisted to analyze the feasibility of strengthening the financial
resource base through enhanced internal revenue generation through Non-Tax Revenue (NTR)
collection and retention, establishment of an Agricultural Research Trust Fund (ARTF), co-
financing of the CRGs, and above all the development of NARO as a quality brand with a
corresponding communications and marketing strategy. In this way, this subcomponent will
strengthen the effectiveness and interaction of the six key aspects of NARO's responsibility: (i)
NARIs established effectively in accordance with the NAR Act (2005) and operating efficiently;
(ii) ZARDIs established and operational with programs owned by local stakeholders; (iii) a
synergistic role of public and private ARSPs established and operational in the NARS; (iv) the
coordination and operations of the NARO Council and Secretariat efficient and effective; (v)
M&E and MIS established and operating effectively and time-bound; and (vi) adequate, timely,
and sustainable funding for agricultural R&D attained. The effectiveness and efficiency of the
NARS will be strengthened through four specific activities and outputs.
Activity 1.2.1: Critical mass of public and private ARSPs with competencies and capacities for
managing and implementing client-oriented, demand-driven, and market-responsive research
created.
22. Human resource development, especially at ZARDIs but also at NARIs and other public
and private ARSPs, is a priority in the drive towards excellence in the NARS. Better incentives
and staff retention, especially at ZARDIs will receive attention. Staff from NARIs and ZARDIs
will receive short-term training in Integrated AR4D principles and other research processes and
methodologies. Scientists in key biophysical and social disciplines, especially at ZARDIs, will
receive MSc and PhD training. Collaborative programs will be established with universities so
that the students supervised by NARO scientists can handle some of the research activities under
their post-graduate programs. Less pressing research activities will be contracted out to allow
NARO scientists to concentrate on strategic priorities. Scientists will be trained and encouraged
to write proposals for funding that allow part-time employment of scientific staff. Other ARSPs
in both the public and private sector will be provided with training opportunities in areas such as
stakeholder-driven priority setting, Integrated AR4D, proposal writing for CRGs, analysis,
reporting and publishing of research results, etc.
23. NARO being a leading NARS in the region can benefit substantially from exchanges and
cross-fertilization with other agricultural research organizations both in the public and private
sectors, and the CGIAR. ATAAS therefore will provide resources to NARO to engage
international panels of experts drawn from leading agricultural R&D institutions from across the
world at two times during ATAAS implementation: first well before the ATAAS Mid-term
Review (near the end of year 3); and again at the time of project completion. The TORs of such
panels would be drawn by NARO and be expected to include areas such as institutional
flexibility and efficiency, the adequacy of linkages and collaboration with other agricultural
research centers and ways to enhance it, HRD systems quality and competitiveness including
NARO scientific staff capacity, the reliability and relevance of priority setting mechanisms,
NARO-NAADS-stakeholder partnership viability and sustainability, the successes and potentials
51
of PPPs, CRG performance and scope, etc. There will also be provision for two study tours by
senior NARO staff including some members of the Council to examine the organization,
management and funding of other advanced NARS in South and East Asia and South America.
Activity 1.2.2: Adequate equipment and facilities for research developed and maintained.
24. Inadequate recent investments in equipment, facilities, and their maintenance, along with
the expanding number of ZARDIs and the drive towards excellence, pose a substantial challenge
in terms of infrastructure. Although some infrastructure will be provided through EAAPP in
relation to the four selected commodities, there will be significant remaining requirements under
NARP--mainly rehabilitation, minor modifications, maintenance, equipment, and transport, with
the possible exception of Bugginyanya and Nabuin where new ZARDIs are envisaged.
Infrastructure needs mainly concern office and laboratory facilities; a guiding principle will be to
make optimum use of existing buildings. An issue of concern is the general of security at the
proposed location of the Nabuin ZARDI, which may necessitate a pragmatic implementation
program for investment. Concerning laboratory and other equipment, wherever possible the
optimum utilization of already established facilities at other Institutes will be exploited before
creating additional capacity. Given the need for adequate planning of the proposed civil works
and the lag time before equipment can be actually utilized, it is expected that much of the
concerned procurement would take place in the second year of the project.
Activity 1.2.3: PARI governance enhanced through effective stakeholder participation and PPSs;
M&E/MIS improved and enforced.
25. NARO and the NARS as a whole will fulfill their mission by emphasizing the following
core values: (i) inclusiveness (all interested stakeholders to be part of the NARS); (ii)
transparency for trust and partnership; (iii) professional integrity and ethics; (iv) accountability to
stakeholders based on value-for-money principles; and (v) excellence in research processes and
outputs. The involvement of stakeholders in the governance of NARO and the PARIs will be
enhanced by training NARO Council, NARI and ZARDI MC's members, and by beneficiary
assessments, which will lead to jointly endorsed quality improvement programs. NARO
Secretariat will further develop and update research implementation guidelines especially
concerning joint priority setting and will accredit and monitor compliance of all NARIs, ZARDIs
and other ARSPs. All program-related guidelines will be in place before the start of ATAAS. In
the last ten years, the NARS has had difficulty demonstrating outcomes and impacts because it
has lacked impact assessment data. To convince investors to fund its research, NARO will make
a greater effort to actually measure outcomes and impacts in the context of the MAAIF-wide and
NAADS inclusive effort to strengthen M&E and MIS.
Activity 1.2.4: Adequate funds for sustainable agricultural research mobilized.
26. To contribute to financial sustainability, NARO is in the process of establishing an
ARTF. A trust deed is being processed, and NARO Council through NARO Secretariat will
conduct a sensitization and fund raising campaign, initially to convince the GoU to provide seed
money and later to gain support from other donor organizations27. The dialogue with the GoU
concerning the MTEF ceiling for research in view of the New Partnership for African
Development (NEPAD)/CAADP targets will be intensified and is expected to result in an
27
Most of the DPs involved in ATAAS will not be in a position to contribute to an ARTF due to internal rules.
52
increase by at least 10 percent annually. CRG funding would be increasingly contributed by the
GoU while funding from DPs would be expected to gradually decrease over time. Internal
revenue generation at the NARIs and ZARDIs, mainly through non-tax revenues (NTR), will be
greatly increased, for example by using land at the Institutes to produce elite seed under contract
and make it available to farmers, NGOs, and sector ministries. Other sources of NTR will
include sales of products from engineering workshops, hiring out equipment, eco-tourism,
providing soil laboratory services and producing planting materials. Corporate business plans
will be developed for all NARIs to determine the feasibility of NTR and guide the process of
income generation. NARO Secretariat will also explore ways in which NARO scientists could be
encouraged to conduct consultancies contributing to revenue generation without compromising
their core mandates and/or creating conflicts of interest. Other funds generated internally will
come from contracts with the private sector or through PPPs. NARO Secretariat and the NARIs
and ZARDIs will open up facilities for other ARSPs and will ensure certification and
accreditation of R&D facilities. External funds will come in mainly from NARO scientists
accessing CRGs provided by foundations, bilateral funding agencies, or through collaboration
with the CGIAR Centers and regional organizations.
COMPONENT 2: ENHANCING PARTNERSHIPS BETWEEN AGRICULTURAL
RESEARCH, ADVISORY SERVICES AND OTHER STAKEHOLDERS
(US$ 72.4 million: US$ 49.8 million from GoU, US$ 11.5 million IDA, US$ 7.2 million from
GEF and US$ 3.9 million from other DPs).
27. NARO and NAADS recognize that a closer alliance between the two institutions and
effective partnerships with other stakeholders, are crucial to achieving the expected outcomes
and impacts. Closer links and collaboration can be forged by involving multiple stakeholders in
priority setting and market-relevant research, and by developing strong NARS-NAADS
research­advisory service interfaces at the national, zonal, and local levels. This also needs
stakeholder platforms, MSIPs and PPPs for more relevant and better quality research outputs,
and more effective uptake pathways for priority value chains. Some of the proposed joint
NARO-NAADS actions described in detail below under subcomponents 2.1 to 2.5 are: (i) joint
priority setting, planning, and review of AR4D, including the establishment of MSIPs feeding
into participatory, demand-driven technology development and adaptation through the delivery
of on-farm R&D services and improving access to seeds and breeds; (ii) development,
demonstration and scaling-up of SLM technologies; (iii) institutional capacity strengthening
especially for staff at the research-extension interface; (iv) joint M&E, based on a common
results framework; and, (v) development and operation of a joint ICT system.
28. NARO and NAADS will be jointly responsible for the implementation of the activities
proposed for this component. At the national level, overall implementation responsibility would
be with a senior staff in each organization, backed up by joint NARO-NAADS and other key
stakeholder committees for each specific activity carried out under the component. Overall
coordination would be with the existing NARO Council Users Committee and the NAADS
Board Program Committee. At zonal level, the ZARDIs will be focal points for functional multi-
stakeholder innovation platforms and joint activities of NARO and NAADS. The responsibility
for implementation of Partnership activities would be with ZARDI Directors and the NAADS
Zonal Coordinators, with the latter having lead responsibility. At that level, oversight would be
with the ZARDI MCs. The implementation of the adaptive research activities would be carried
53
out by the District Adaptive Research Support Team (DARST), established in all districts on the
basis of agricultural Subject Matter Specialists (SMSs), to allow the increased flow of
technologies and timely feedback from farmers to researchers.
Subcomponent 2.1: Joint Prioritization, Planning, Adaptive Research, and Technology
Scale-Up
Activity 2.1.1: Demand-driven, market-responsive, and client-oriented priority setting and
planning process strengthened.
29. NARO and NAADS will link their priority setting and annual review processes at the
local (i.e. sub-county and district farmer fora), zonal, and national levels. One of the main
challenges of integrating the priorities and actions of NARO, NAADS, and other key
stakeholders is to adapt and synchronize ongoing processes under reviewed and simplified
guidelines while aligning them with the GoU's overall annual planning and budgeting cycle. To
allow effective joint NARO­NAADS the following sequence of activities is suggested: (i)
NARO/NAADS Secretariats simultaneously issue Indicative Planning Figures for individual
and joint programs; (ii) NAADS leads planning and priority setting at community, parish, and
Sub-county levels involving all key stakeholders28; (iii) NAADS also leads planning at the
district level with technical support from the respective ZARDIs; (iv) joint NARO­NAADS
planning at the zonal level led by the ZARDIs; and (v) joint NARO­NAADS planning at the
national level involving the NARIs. During ATAAS implementation, for those enterprises for
which MSIPs have been established (see activity 2.1.2 below), these would be increasingly
involved in the priority setting processes at each of the concerned levels.
30. The criteria for priority setting will be broadened to include ex-ante economic analysis
and demonstrated interest from farmers and other market actors. The assembly and assessment of
stakeholders' priorities will be managed jointly by farmer organizations, the private sector, LGs,
NAADS, ZARDIs and other stakeholders. Regular assessments of research outputs by clients
will lead to quick readjustments in priorities. Innovative methods to diagnose biophysical
constraints will help to determine long-term trends and effects related to agricultural
intensification and climate change.
31. To support these activities, ATAAS will finance: (i) background technical and market
studies to facilitate zonal priority setting; (ii) capacity building of process facilitators and
stakeholders in farmer groups and fora at the sub-county, district, and zonal levels; and (iii)
meetings at different levels with all key stakeholders, including farmer representation through
their fora.
Activity 2.1.2: Functional MSIPs established.
32. MSIPs can greatly improve linkages between key stakeholders to share information and
knowledge and coordinate their activities. Functional MSIPs will be the main drivers of
knowledge sharing and learning, joint demand-driven needs assessments, implementation
coordination, as well as stakeholder reviews of activities within the farming systems and value
chains. In such platforms different stakeholders join and coordinate respective actions to achieve
a common objective. Platforms at the lower levels (such as the community, parish, sub-county
and district) would provide for relatively informal ad-hoc interactions between farmer groups,
28
In all cases, where one organization leads, the other partner would participate based on available resources.
54
farmer fora and other concerned players in agricultural R&D from both the public and private
sector. More formal and sustained MSIPs would be established at zonal and national levels to
achieve collaboration and learning in an innovative system context29. This bottom-up approach
will achieve greatly enhanced and more relevant joint priority setting and planning. It will also
ensure joint stakeholder reviews of implemented activities throughout the farming systems and
value chains, cutting across expected outputs and outcomes of the proposed ATAAS.
33. The key actors or stakeholders of MSIPs are comprehensively identified in the NARP
proposal as: (i) the farmers, agricultural producers and their organizations or fora; (ii) agro-
dealers, market agents, traders, and agro-processors; (iii) the policy makers of MAAIF, the
infrastructure service sector, the Ministry of Trade, and financial services; (iv) the research and
knowledge generation sector; and, (v) intermediaries, brokers, and extension organizations of all
types (technical, financial, commercial). The actual composition of MSIPs would differ greatly
depending on the level of their establishment. Considering different stakeholder expectations and
working arrangements, putting the MSIP concept into practice requires considerable capacity
building--and time--for stakeholders to understand the concept, arrive at mutually agreed
objectives, and to establish a functional organization, and develop management and funding
arrangements.
34. To support these activities, ATAAS will finance: (i) capacity building of process
facilitators and stakeholders at the sub-county, district, zonal and national levels; (ii) meetings
and workshops at different levels involving all key MSIP stakeholders; and, (iii) study tours of
MSIP actors.
Activity 2.1.3: Joint implementation of adaptive research activities.
35. This activity complements activities 2.1.1 and 2.1.2, which seek to enhance farmers' and
other stakeholders' demands for and participation in technology development and promotion to
increase the productivity and profitability of their enterprises. Based on stakeholder priority
setting and MSIP inputs, this activity will establish efficient and effective delivery and uptake of
demand-driven technology and knowledge by integrated implementation of on-farm research
including at the NAADS-managed Technology Development Sites. Partnership in on-farm
Integrated AR4D actions would require formal and effective mechanisms to be put in place at the
respective levels for joint operations by NARO, NAADS, and other public and private
organizations, such as seed and input companies, NGOs, universities, farmer organizations, agro-
processors, etc. Within this collaborative framework, some of these joint operations will
comprise one-off, while others will involve formal longer-term agreements. Under these
agreements, NARIs and ZARDIs will share technology, train stakeholders, provide technical
assistance, share laboratory access, and hire commercial services, among other activities. The
collaborative framework will allow research institutes to respond adequately to short- and
medium-term demand-driven needs. This collaborative framework will complement the joint
value chain activities on cassava, rice, dairy, and wheat financed under EAAPP.
36. ATAAS responds to farmers' and stakeholders' demands for new technologies by more
effectively linking agricultural advisory services and research systems. At the national level, the
NAADS and NARO Secretariats have already developed a partnership framework for joint
29
The ZARDIs and NARIs will be most intensively involved at zonal and national level; however, their linkage and
interaction with subcounty and particularly district-level platforms will be crucial.
55
action focused on: (i) increased awareness of technologies; (ii) equitable access and utilization of
demand-driven agricultural technology; (iii) increased adoption of relevant and sustainable
agricultural technologies and practices; and, (iv) improved quality of agricultural technology and
enhanced institutional capacity.
37. At the local level (subcounty and district), the generation and development of appropriate
technology largely depend on the functionality of the processes that link farmers' technology
needs with technology development. NAADS will enhance local level processes for articulating
farmer needs into technology demand by: (i) increasing farmers' involvement in developing
technology; (ii) developing capacity of SMSs and setting up DARSTs; (iii) putting technology
performance tracking mechanisms in place; and (iv) involving the private sector in identifying
needs, providing information on market requirements, and developing technology.
38. At the zonal level, the key institutional arrangements will be built around the ZARDIs,
who will lead the first levels of on-farm technology adaptation and development while enhancing
the capacities of DARST SMSs to handle the next stage. At the sub-county and community
levels, complementary on-farm trials and demonstrations will be led by NAADS with technical
support and training from DARSTs, ZARDI scientists, and/or contracted AASPs. For new
technologies generated through research, trained AASPs will be resourced to set up
demonstrations, ensuring that there is a fit with the local production systems. This demand­
response continuum will increase the flow of technologies and farmers' access to a broader range
of technical options adapted to their farming systems and priority enterprise(s). It will also
strengthen the feedback loop providing the ZARDIs with farmers' assessment of proposed
technologies.
39. To support these activities, ATAAS will finance: (i) capacity development of all
concerned players (DARST staff, AASPs, and other stakeholders); (ii) farming systems and
livelihood studies; (iii) the operational costs of on-farm trials, including inputs and/or
equipments; and (iv) the publication of pamphlets and farmer adapted information.
Activity 2.1.4: Multiplication of planting and stocking materials.
40. Where appropriate, ATAAS will promote farmer-based multiplication of planting
materials, animals, and technologies that still lack a commercial market. The NARS constantly
develops and introduces new crop varieties and breeds but farmers' access to these improved
technologies remains a challenge. The arrangements required for farmers to obtain new cultivars
and breeds are a subset of the partnerships between the NARS and other organizations. ATAAS
would complement support from EAAPP for cassava, wheat, rice and dairy (pasture and fodder
crops and cattle breeds), and support NARO using similar arrangements for the other priority
crop and livestock commodities as follows: (i) provide investment and operational support for
NARO to produce breeder seed to meet private sector demand; (ii) offer technical assistance as
required to allow seed companies to produce their own breeder seed instead of purchasing it each
year: (iii) organize and provide training for seed company staff in all aspects of seed production
from field operations through seed treatment and packaging; and, (iv) provide technical
assistance to the National Seed Certification Service of MAAIF and NAGRIC to establish
standards for seed certification for vegetatively propagated crops. NARO will leave seed
multiplication beyond breeder seed to other agencies, except for orphan and vegetatively
propagated crops that are not yet considered viable investments by the private seed sector.
56
41. For those crops, ATAAS will support NARIs to contract with third parties, such as seed
companies, tissue culture laboratories, and specialized farmer groups, to produce foundation seed
and/or will support ZARDIs to produce such seed. The NARIs will also produce breeder seed for
vegetatively propagated crops and work with ZARDIs and farmer groups to multiply foundation
planting material when required.
42. Enhancing access to these foundation technologies would need NAADS support and
training activities in: (i) community multiplication of seed and planting material by food
security farmers; (ii) farmer-based nurseries and mother gardens to produce mostly vegetatively
propagated materials; (iii) Quality Declared Seed production by market-oriented farmer
enterprises and supported by NAADS; (v) associations of seed producers for multiplying seed
stocks; (iv) partnerships with private entities involved in multiplying seed, including contract
farmers, and seed dealers. In consultation with MAAIF, effective quality control mechanisms
will be established to ensure that these multiplication efforts meet at minimum the essential
requirements for plant health and for breeding materials that are true-to-type.
43. The quality of technologies and inputs was a major concern in Phase I. Quality assurance
is the responsibility of MAAIF, including its specialized agencies. 30 NAADS will closely liaise
the responsible MAAIF departments and agencies, including NARO, to ensure that quality is
assured. Support to strengthen MAAIF's regulatory services will be integrated into the planned
second track project in support of DSIP. The foundation for quality assurance will be laid by
developing the capacity of all those involved in multiplying planting material and seed, which
will facilitate certification and support inspection. NAADS will also link with the existing
umbrella bodies for agricultural input supply, such as the Uganda National Agro-Input Dealers
Association (UNADA), to further develop and strengthen the agro-input distribution networks.
44. Under ATAAS, NARO would take the lead in carrying out: (i) investment and
operational costs to produce breeder seed; (ii) technical assistance for seed companies on all
aspects of seed production; (iii) training for seed company staff; and (iv) temporary technical
assistance to the National Seed Certification Service and the National Animal Genetic Resource
Center & Data Bank. The support to NAADS would focus on (i) supporting the development of
farmer and community seed producers, and (ii) facilitating quality control and supporting agro-
dealer associations to strengthen their networks through technical assistance and training.
Subcomponent 2.2: Sustainable Land Management
45. GEF financing will help to scale up SLM, thereby enhancing the environmental resilience
and sustainability of agricultural land resources and generating local and global environmental
benefits in addition to improved yields. GEF will strategically and incrementally promote and
institutionalize SLM practices through NARO-NAADS partnerships to deliver broader technical
options to farmer groups. NARO and NAADS will both implement the proposed SLM activities,
many of which derive from sizeable body of analytical work and investment programming by the
GoU and DPs in recent years, It will promote SLM information support, investment planning,
and monitoring across the agricultural sector by strengthening the performance of MAAIF,
NARO, and NAADS. Especially relevant documents are the SLM PER and the GoU's multi-
30
Such as the Uganda Coffee Development Agency and National Animal Genetic Resources Center/Data Bank
(NAGRC/DB).
57
sector SLM Investment Framework, led by MAAIF as part of CAADP programming, with the
close involvement of four other ministries with an interest in land resources.
46. Fully blended GEF support is organized around three sets of activities in the proposed
project: (i) improving institutional governance by strengthening capacity for SLM planning and
practice, (ii) scaling up on-the-ground activities for improved natural resource management
(NRM); and (iii) reducing vulnerability through natural resource monitoring and knowledge
management. The activities co-financed by GEF are summarized in the following paragraphs:
Activity 2.2.1: Improving institutional governance.
47. Overall Focus: GEF incremental support will finance improvements to the institutional
environment needed to sustain a long-term effort to scale up climate-smart land and water
management practices and align land and climate policies. Support will focus initially on the
NARO-NAADS interface and later on MAAIF's capacity (with funds disbursed through NARO)
to improve investment programming for land productivity and related climate risk.
48. NARO and NAADS: GEF incremental support will increase the depth and reach of
research and advisory services on natural resources and SLM to reduce the risks that land
degradation and climate change pose to agricultural production and ecosystem services. Work
will focus on strengthening networking and connecting NARO and NAADS staff at central,
zonal, and local levels with an increasing numbers of farmers in major Agro-ecological Zones
(AEZs) on specific SLM practices. This will allow developing communities of practice on SLM.
49. MAAIF: The support to MAAIF (via NARO) will solidify the GoU's ongoing work to
coordinate knowledge, M&E, and investment programming across stakeholders and sectors on
land degradation and climate risk via the National SLM Committee. This committee, chaired by
MAAIF, includes staff at senior technical and permanent secretary levels, involves five
ministries with an interest in land resources, and is building a national alliance on land
productivity and natural resources. The GEF financing will also cover significant additional
work on institutional governance at NARO and NAADS under ATAAS components 1 and 3.
50. GEF will specifically finance consultancies, training, workshops, communications,
equipment, and travel related to the following outputs: (i) the establishment and operating costs
of putting institutional mechanisms in place for coordination of SLM at the National SLM
Committee anchored in MAAIF; (ii) strengthening NAADS technical capacity to provide advice
on priority SLM practices as a response to land degradation and climate risk; and (iii) engaging
specialists to lead SLM activities at each ZARDI for the duration of project implementation to
advocate for SLM, train AASPs, liaise with researchers, diffuse and collect knowledge, and form
the core of an emerging community of practice on SLM.
Activity 2.2.2: Scaling up on-the-ground activities for improved NRM.
51. The GEF support will co-finance the development and demonstration of SLM technology
options. The SLM technologies include integrated soil nutrient and moisture management and
low tillage, nitrogen fixation from agro-forestry and/or cover crops, land/watershed
rehabilitation, and erosion control. This work involves trials, economic analyses, field
demonstrations, and farmer field days in five selected sub-counties in major AEZs, targeting the
main crops prioritized at each ZARDI. NARO will lead trials and NAADS will lead advisory
services, while working together on field days and demonstrations. NAADS will promote large-
58
scale adoption of technologies and approaches for climate-smart SLM adapted to local farming
systems.31
52. GEF will specifically finance farm trials, on-farm demonstrations, and participatory
innovation. It will also finance the related consultancies, labor, training, workshops, travel,
printing and documentation, satellite data, equipment, and supplies (such as seed and other
inputs). NARO and NAADS acting in a coordinated manner will deliver the following outputs:
(i) develop and demonstrate technology packages on integrated nutrient management and
conservation agriculture for major AEZs; (ii) develop and apply analytical tools, including
simulation models, on land productivity and climate risk; and (iii) scale up advisory services to
farmer groups on SLM technologies, small-scale irrigation, and water harvesting for major
AEZs. The technologies to be scaled up include terraces, contour bunds, grass bunds,
conservation agriculture, rehabilitation of degraded micro-watersheds, agroforestry, woodlots,
water harvesting, and agronomic SLM practices. For each activity, partners will assess the
profitability and conduct annually a joint field day per AEZs.
Activity 2.2.3: Reducing vulnerability through NRM monitoring and knowledge management.
53. GEF will co-finance the development of ICT for SLM to institutionalize linkages and
networking between all constituents of NARO and NAADS and other actors. ICT will support
information and knowledge exchange, foster collective learning and pooling of resources, and
will ultimately improve governance. An MIS will be developed jointly for internal and external
use. Capacity development programs will be supported to strengthen the role of stakeholders in
management and oversight, planning, implementation, and evaluation of programs.
54. MAAIF Headquarters will work with NARO, NAADS, and the four participating line
ministries to develop a joint multi-sector monitoring, evaluation, and learning system to track
investment responses to land degradation and climate risks across agencies and sectors and share
knowledge. This system will be integrated with existing GoU systems and include
benchmarking, impact evaluations of SLM investments, guidelines for M&E on land degradation
and climate risk, development of a simplified GIS and knowledge management system, and
lastly the establishment of thematic information exchange networks on climate, technology,
M&E, and policy and protocol harmonization. Stakeholders will be trained on all aspects of the
system. The agencies will carry out advocacy and evidence-based planning on integrated land
and water management, land degradation, and on mitigating climate risks. To institutionalize
communities of practice around this theme, support will be provided for a communications
strategy, policy outreach, community outreach, school curricula, and media campaigns.
55. GEF support will also co-finance the development and application of analytical tools on
land productivity and climate risk. These tools will be especially useful for performing climate
risk due diligence on agricultural and forest activities. They will also support analyses of land
use and land use change to guide investment priorities in sustainable agricultural land
management, which in turn will help secure land productivity and resilience. NARO will also
develop and apply shared tools to monitor land productivity trends across agencies and sectors
by: (i) building on current monitoring of soil organic matter, soil quality and carbon in 24 sites
across all AEZs; (ii) updating and digitizing soil maps; (iii) tracking of changes in vegetative
cover using cutting-edge, low-cost satellite imagery. The M&E work will also include: (iv)
31
Working Document 5 in Annex 14 provides details on technologies to be promoted and Annex 3 lists the targets
for SLM technologies and practices under ATAAS.
59
application of an expert survey for tracking changes in the enabling environment for SLM; and
(v) the methodology and data collection for reporting on the performance indicator for the GEO.
Subcomponent 2.3: Institutional and Human Capacity Strengthening
Activity 2.3.1: Research­extension­farmer linkages strengthened.
56. The DARSTs will spearhead the technical drive to enhancing access and sustained use of
technologies and information. This SMS team will coordinate the implementation of research-
extension activities throughout the district in close interaction with ZARDIs and NAADS, in line
with priorities set by the respective MSIPs. This activity will be included in the TORs of the
SMSs as part of the NARO and NAADS PIMs. The DARST SMSs assisted by the best-qualified
AASPs s will develop the capacity to support and monitor local AASPs in generating/adapting
client-relevant technology while facilitating: (i) greater involvement of specific categories of
farmers in particular agro-ecologies in articulating their needs for technology; (ii) intensified
participation in technology development by market oriented and commercializing farmers; (iii)
development of technology tracking mechanisms at the district and sub-county levels to follow
the performance and possible adaptations of a given technology; (iv) stronger feedback loops and
information exchange with the concerned ZARDIs; and (v) development of high technical
standards for IAR4D through joint learning between Makerere University, NAADS, NARO and
other stakeholders (see below).
Activity 2.3.2: Strengthening capacities and standards of agricultural advisory services.
57. Supported by ATAAS, NAADS will employ AASPs on a competitive basis from various
sources, research institutions, PPPs, contracted providers, as well as CBFs to fill gaps both in
numbers and skills. Emphasis will be on strengthening the capacities of all chain actors, notably
the AASPs. Particular attention will be paid to CBFs who will provide for continuity of services
and strengthening of farmer-to-farmer advisory services. The strategy for developing the
capacity of private AASPs that was developed in Phase I will be reviewed to embrace all
categories of service providers, taking into account advances in ICT.
58. NARO (through the PARIs) will train its staff on a range of topics including
environmental and social safeguards. It will also train and backstop service providers and in
particular play a greater role in increasing the technical capacity of district SMSs serving in the
DARSTs to fulfill their quality assurance and standard setting function. Training will also cover
establishing technology demonstrations, the facilitation of farmers' participation in technology
promotion and uptake, and environmental and pesticide handling safeguards.
59. Specialized service providers will be contracted by the NAADS Secretariat to provide
basic training and annual refresher courses to local AASPs, particularly in participatory
extension methodologies and approaches, including conventional delivery as well as market-
oriented services. Alternative approaches, such as farmer field schools, will be piloted.
60. The main NAADS-led activities will involve: (i) assessment of capacity development
needs for different AASPs; (iii) training program and material development; (iii) implementation
of basic and refresher training; and (iv) evaluation of training effectiveness.
60
Activity 2.3.3: Quality assurance of advisory services
61. At the sub-county level, advisory services will be provided under performance-based
contracts. The development of standards for service provision and a regulatory framework to
ensure compliance will be key priorities under ATAAS. AASPs will be required to have a
minimum level of qualification at entry and will be expected to increase their capacity through
continued training and performance evaluation. A certification process will be developed for
AASPs to qualify for contracts. NARO and other accredited institutions will develop a program
for training and capacity building. For those who qualify, certificates will be issued to provide
the basis for MAAIF certification. In restructuring the district production departments, ToRs for
SMSs will include specific roles and responsibilities in backstopping, quality assurance, and
technical auditing of AASPs.
Subcomponent 2.4: Joint Results Framework/Monitoring and Evaluation
62. NARO and NAADS Secretariats will be jointly responsible for the strategic planning of
project activities and the monitoring of their results. A joint Steering Committee chaired by the
Planning Department of MAAIF and comprising the M&E and planning staff of NARO and
NAADS, and a representative from UBOS will oversee the implementation of M&E activities.
The day to day implementation of ATAAS M&E activities will be the responsibility of a joint
team of NARO and NAADS M&E staff led by the M&E officer from each organization for a
period of two years on a rotating basis. At the start of the project, a consultant may be engaged to
assist in the design of the M&E system, and to ensure the readiness of NARO and NAADS to
implement a comprehensive M&E regime.
63. The M&E system will be three-pronged: (i) monitoring to track progress and
effectiveness in project implementation (inputs, activities, processes, and outputs, intermediate
outcomes, and PDO and GEO indicators); (ii) periodic special studies and evaluations targeting
specific aspects of the program performance, including external accountability tools such as
citizens report cards and community scorecards; and (iii) a rigorous impact evaluation to
measure the consolidated results of the project at mid-term and upon closing. The impact
evaluation will be use nationally representative household surveys conducted at the start
(baseline), mid-term and near the closing of the project. The Results Framework, specifying the
outcome and intermediate outcome indicators along with annual targets, is presented in Annex 3.
The PIM will list the specific activities that will be implemented to realize each intermediate
outcome indicator in the Results Framework.
64. An information system will be developed to track implementation progress, building on
the systems currently in place. Project implementation will be monitored by a joint
NARO/NAADS team reporting concurrently to the NARO DG and the NAADSs ED, and in turn
to the respective NARO Council and NAADS Board Committees, whereas impact will be
evaluated by an independent entity.32 The internal monitoring system is central to sound
management, vital for informing project management about day-to-day performance, and plays a
key role in supporting decisions related to any corrective actions that may be necessary. The
independent impact evaluations will be undertaken by credible firms and designed using
appropriate approaches. They will focus on the extent to which the project has succeeded in
32
As indicated under Component 1.2, just before the ATAAS MTR and at Project Completion, NARO would also
organize an External Panel Review.
61
meeting its set objectives through an evaluation of the intermediate outcomes and achievements
in relation to the PDO and GEO.
65. A customized MIS will be developed and the capacity of the implementing institutions
will be enhanced for the successful implementation of the project. The MIS will be developed
based on the joint project Results Framework and focus on the results chain--linking the PDO
and GEO to project intermediate outcome indicators, outputs, activities, and inputs. This tool
will be fully integrated into the improved ICT environment envisaged under the project. It will
be effective for project management and provide a feedback loop for NARO and NAADS
Secretariats to detect and provide solutions to implementation problems as they arise (see Annex
3 for details on the MIS, the M&E Plan, and the Results Framework).
Subcomponent 2.5: Joint ICT Applications
66. NARO and NAADS have identified ICT as a means of strengthening internal
management capacity, improving research capabilities, accessing and sharing knowledge, and
delivering agricultural advisory services and information. Despite their unified mission, both
institutions currently maintain independent ICT infrastructure, systems, and websites. ATAAS
will develop an integrated information and communications platform that support the
increasingly collaborative and integrated processes at NARO and NAADS. An extensive and
integrated platform will require standardized infrastructure at all levels of NARO and NAADS
operations, including NARIs and ZARDIs and NAADS district and sub-county offices. This
infrastructure will support joint systems such as M&E, Knowledge Base, Workflow, and a joint
internal and external Portal. Implementing a Joint ICT Platform will require significant process
re-engineering, capacity building and change management within both institutions. Introduction
of a Joint ICT Platform is anticipated to result in significantly improved internal management
capability and service delivery.
67. The core ICT platform implemented through ATAAS will be a Joint Services Center,
which will introduce a shared infrastructure, an integrated information and service delivery
platform and organizational framework to NARO, NAADS, partners, service providers, and
clients. This approach unites operational functions on the basis of core workflow processes and
built-in quality assurance mechanisms. The Joint Workflow Management Platform, modeled
upon the cyclic research and extension processes, will standardize those processes, improve
coordination, and collect data related to performance and accountability. The change
management that will have to take place within two institutions will propagate a culture of
accountability, transparency, and efficiency.
68. Activities to establish and operationalize the Joint Services Platform will be focused
around three key pillars: (i) transition to joint infrastructure, (ii) transition to joint databases and
systems, (iii) development of a joint web and mobile-enabled interface for information and
service delivery as presented in the figure below.
69. A joint infrastructure will be introduced at national, district and sub-county levels and
consist of hardware (desktops, net books, smart phones), software (antivirus, backup), network
infrastructure, consolidated server and datacenter infrastructure, back up and disaster recovery,
power backup and other necessary infrastructure to be determined through a feasibility study. It
is anticipated that at national and district level it will be possible to maintain web enabled
systems: however, given connectivity and electricity gaps at sub-county levels, the project will
62
rely on the use of net books with a downloadable content to be updated monthly at the district
office. When necessary and feasible the project will invest in bridging electricity gaps at the sub-
county level.
70. The core processes of both institutions will be evaluated, re-engineered when necessary
and automated through introduction of the Joint Services Center. The project will support
development of the workflow systems to enable end-to-end workflow management of NARO
and NAADS in an integrated manner. This would include an integrated M&E database providing
for a results based management, and Knowledge Base database ensuring institutional memory
and access to all research and other documentation. The project will also support integration of
existing FM systems with IFMIS, web and mobile enabled complaint system, and a database for
service provider management. The owners of the system will be Director General of NARO and
the Executive Director of NAADS. The infrastructure will be maintained by the IT departments
of each institution. Overall coordination and oversight will be provided by the Chief Information
Officer and Steering Committee respectively.33
71. External and internal portals will be developed. An Intranet Portal will allow to securely
share information or operational systems within the two organizations. It will serve as the
interface for NARO and NAADS systems and information and constitute the focal point of
internal communication and institution wide collaboration. The key users of the Intranet will be
NARO and NAADS managers, system administrators, staff, and contributing partners. A joint
Public Portal will provide access to public information, services and digitized research
documents relevant to the public; this portal will also link independent websites maintained by
NARIs and ZARDIs as well as NAADS district offices. Both institutions will use the intranet
and public portals to collaborate with other research organizations and bring together research
developed outside by other stakeholders. External information services provided through the
public website could include, among others, input and output market information, early warnings
and alerts, and reports from food security information systems. These services will be supplied
through formal contracts or MoUs.
72. Two feasibility studies will be undertaken to: (i) assess the current ICT infrastructure for
NARO and NAADS at national, district and sub-county level, to determine how they can be
33
The Working Paper 6 in Annex 14 contains a detailed description of the ICT activities to be supported under
ATAAS.
63
integrated within the Joint ICT Platform; (ii) assess informational needs of NARO and NAAD's
beneficiaries and other stakeholders and develop a web and mobile enabled information and
services delivery strategy and generate a public private partnership model for selected mobile
applications.
COMPONENT 3: STRENGTHENING THE NATIONAL AGRICULTURAL ADVISORY
SERVICES (US$ 317.8 million: US$ 239.8 million from GoU, US$ 58.1 million from IDA, and
US$ 19.9 million from other DPs).34
Subcomponent 3.1: Farmer Institutional Development (FID)
73. This subcomponent focuses on farmer empowerment and organizational strengthening,
which are the core principle of NAADS. Its objective is to enhance the capacity of farmers, their
groups and farmer organizations to make choices and implement decisions that affect their
livelihoods. Because farmer empowerment was a prerequisite for demand-driven advisory
service, NAADS Phase I supported farmer groups and established farmer fora at the subcounty,
district, and national levels. These institutions have proved effective. Under ATAAS, they will
be strengthened and new ones will be formed where necessary.
74. Aside from being central to the efficiency and effectiveness of advisory services, farmer
empowerment and FID are crucial for governance and accountability. Farmer empowerment--
through greater transparency, effective participation, and decision making--is a central feature
of the GAC arrangements, especially to ensure the accountability of implementers at the local
level.
75. Farmers have quite varied social and economic circumstances, and this variation is
further influenced by gender and age. FID will pay particular attention to the inclusion of
women, youth, people with disabilities and other poor famers during group mobilization and the
formation of other farmer institutions such as the farmer fora. The NAADS Board has recently
doubled the weights for women and youth in the selection criteria for grants.35Recognizing the
economic and social heterogeneity of its client base, gender mainstreaming and inclusiveness is
another core principle of NAADS. To ensure that as many farmers as possible participate in and
benefit from processes intended to improve the availability and use of technologies and
information, farmers will be categorized36 in their progression from subsistence to market
orientation, using criteria that take into consideration the asymmetries in power, resources and
capacity. A combination of push and pull strategies are incorporated into the ATAAS design
to assist the poor and disadvantaged farmers to move out of poverty and subsistence. The
increased emphasis on food security enterprises in ATAAS will help enhance the targeting of
poor and vulnerable men and women farmers. Farmer categorization will promote the learning
effects between group members and also help tailor the services to better suit the specific needs
of different farmers, and group marketing and outgrower schemes will help the disadvantaged
persons take better advantage of market opportunities. The strategies for strengthening social
34
EAAPP provides complementary financing by supporting NAADS in training and dissemination (about US$ 1.5
million) and MAAIF and private partners (about US$ 3.5 million) for improved availability of seeds and breeds.
35
For Food Security and Market Oriented Enterprise Promotion grants, the criteria weights for women and youth
have been increased from 5 to 10 percent and for the local level Commercialization Challenge Fund to 15 percent.
36
For ATAAS, four broad categories of farmers populate the continuum from subsistence to full-scale commercial
agriculture: food security farmers, market-oriented farmers, commercializing farmers, and nucleus farmers.
64
inclusion and gender mainstreaming are further discussed in Working Document 7 in Annex 14.
The subcomponent comprises two activities and outputs focused on strengthening farmer groups,
farmer fora, and HLFOs.
Activity 3.1.1: Existing farmer groups strengthened and new ones formed.37
76. The FID process will continue to strengthen farmer groups to demand services and
maintain control of the program so that they can increasingly leverage and benefit from services
offered to improve the productivity and profitability of their enterprises and enhance their
capacity to negotiate with other actors in the value chain. Farmer groups will be revitalized or
established through redoubled FID efforts in the first year of ATAAS to compensate for recent
disruptions in the program that have caused confusion among the farmers regarding the
program's objectives and implementation modalities. The objective of FID is to help farmer
groups resume their proper role in making decisions, identifying enterprises and technology
needs, selecting demonstration sites and enterprise hosts, allocating resources, and providing
accountability and transparency in the management of key aspects of the program. As a first step,
NAADS will assess the eligibility of groups in each subcounty according to agreed criteria for
group viability, cohesion and repayment history of group members who have received financial
support in the past. Based on the information available, it is estimated that there are about 46,000
viable farmer groups who will be ready to participate in the first year of ATAAS.
77. About five additional farmer groups per subcounty will be mobilized each year, with a
target of about 60 functional groups on average per subcounty by ATAAS completion. NAADS
will contract a service provider (either an NGO or an institutional development specialist) at the
district or regional level to undertake FID activities in each sub-county. This service provider
will recruit Group Promoters (GPs), successfully piloted in a limited number of districts during
Phase I, to assist with the development of farmer institutions. A cadre of about 16 GP/change
agents per subcounty will be contracted through specialized FID service providers and trained
for to manage farmer group development (each handling a maximum of five groups) and micro-
enterprise development. This process will be facilitated and backstopped by Community
Development Officers (CDOs) or Assistant CDOs. Where CDOs are not available, this will be
undertaken by service providers or NGOs contracted for quality assurance.
78. Key responsibilities of the GPs are to ensure that groups are of an appropriate size, and
composition mix, have established a group savings account and mobilize group savings, and to
keep records of meetings and other group activities. Other essential responsibilities are to ensure
groups have functional constitutions in place with a clear leadership structure; have stable
membership and collect membership dues; and engage in group enterprise and group marketing.
Each farmer group will be trained in participatory planning, monitoring and evaluation
processes; reporting; needs assessment; gender and poverty issues; and governance. The training
will deliver information necessary for group action as part of farmer empowerment, will instill
specific skills related to group activities and business development, and will support farmers'
active role in their selected commodity value chains.
79. The GPs will also lead the consolidation of farmer groups by: (i) enhancing farmers'
appreciation of NAADS principles and the execution of their roles; (ii) consolidating the
37
According to the NAADS Act (2001), farmer group means a group of individual farmers, an association,
cooperative or any legal entity with common farming, agro-processing or marketing interested registered under
NAADS.
65
governance systems of farmer groups so that they gradually become viable, independent entities
that mobilize and account for resources on their own; (iii) developing management capacity
within farmer groups, with a particular focus on tendering, contracting, M&E, needs assessment,
and gender and poverty issues; (iv) enhancing the cohesiveness of farmer groups so that their
enterprises become sustainable; (v) developing the commercial orientation of farmer groups by
grounding their activities in sound business principles and assisting them to integrate in value
chains; (vi) improving the ability of farmer groups to articulate their needs and demand
agricultural advisory and other services; and (vii) enhancing the ability of farmer groups to
monitor and evaluate their performance and that of AASPs.
Activity 3.1.2: Farmer fora and HLFO empowered.38
80. Competent agencies and specialized service providers, supervised by CDOs, will be
contracted to develop the capacity of farmer groups and farmer fora executives to undertake their
roles and functions as defined in the NAADS Act. At the subcounty level, executives of farmer
fora will be trained in tendering and contracting processes; contract negotiations and
management; project M&E; reporting; and advocacy, among other skills. The development these
skills in farmer fora is a precursor to piloting an alternative to disbursing funds through LGs.
This alternative funding modality should not only serve as an incentive for improved
performance but also as a means of further empowering farmers to manage financial resources,
in line with NAADS objectives. Implementation of this funding modality will require
considerable investment in capacity building among farmer fora and groups at the district and
lower levels. Farmer fora also need support to rent office space for the proper functioning of the
respective committees at subcounty and district levels.
81. As farm enterprises become more productive, their integration with value chains will
become an increasingly central aspect of NAADS under ATAAS. Farmer groups engaged in an
enterprise at the village level will need to aggregate and organize at a higher level--the
subcounty and beyond--to produce in quantities and at a level of quality demanded by the
market; to have a stronger voice in negotiations; and to play a more diversified role (beyond
production) in commodity value chains. The HLFOs formed in Phase I will be strengthened and
new HLFOs will be formed as required. To provide a more solid foundation to the HLFOs, inter-
group associations will be promoted and supported as building blocks for HLFOs. This aspect of
the program, elaborated under ATAAS component 4, seeks to support the development of value
chains and the active participation of farmers in these value chains. The target is the formation of
at least one HLFO per enterprise in a district. This activity will be outsourced to competent firms
or institutions.
Subcomponent 3.2: Technology Promotion and Farmer Access to Information/Knowledge
82. This subcomponent promotes farmers' participation in technology development and
diffusion to achieve increased productivity and profitability of their enterprises. In Phase I of
NAADS, stronger demand was fostered by creating farmer institutions that took charge of
advisory service provision and pursued more productive, profitable, and sustainable enterprises.
The use of extension advice was expected to trigger a cascade of farmer demands for
38
Farmers Fora means a forum, comprising farmer groups at the subcounty, district and national level, according
to the NAADS Act (2001). In the Act, it is written as Farmers Forum.
66
technologies and information, and lead to further research, broader technology options and
information accessible to farmers.
83. Under ATAAS, earlier achievements in providing market-oriented advisory services and
delivering information to farmers will be consolidated. Emerging issues and challenges of Phase
I will be addressed, especially: (i) inappropriate enterprise selection; (ii) discontinuous service
contracts; (iii) weak farmer participation in procurement and contracting, leading to poor quality
of advisory services; and (iv) inadequate numbers and technical capacities of advisory service
workers. Support will be strategic, focusing on food security and high-priority enterprises for
commercialization, depending on the farmer domain. All along the selected value chains,
interactions and joint learning with key stakeholders in the agricultural innovation system will be
strengthened. This subcomponent will achieve its objectives through the following two activities.
Activity 3.2.1: Farm enterprise selection facilitated.
84. During Phase I of NAADS, the enterprise selection process was not sufficiently based on
a careful analysis of farming as a business, markets or value chain considerations, and the
agro-ecological considerations. Consequently many investments promoting selected enterprises
did not achieve their potential impact. Under ATAAS, service providers will assist farmer groups
in selecting enterprises based on farming situation analysis and market studies implemented in
collaboration with NARO/ZARDIs, universities, and/or specialized organizations. Information
will be updated continuously at the district and subcounty NAADS offices and NAADS website.
85. At the sub-county level, SNC will mobilize a team including the District Commercial
Officers (DCO), competent SMSs and AASPs to guide the farmer fora in the enterprise
prioritization process based on the situation analysis and market studies. At the district level, the
formation of an interactive stakeholder platform, involving farmer groups, farmers fora, and
AASPs will focus primarily on reviewing and analyzing the enterprises selected across the
subcounties, and provide guidance on the emerging opportunities using the information
contained in the regional and national market situation studies. The District Commercial Officers
(DCOs), as the competent SMSs, will be trained to guide the enterprise selection process. At the
district level, enterprises selected by subcounty platforms will be collated and discussed in a
meeting involving farmer group representatives from the subcounty and all other players in the
selected value chains. Selected district enterprises will be supported for enhanced
commercialization of high priority value chains within identified markets. Enterprises that are
not selected for commercialization will be supported through the NAADS strategy for food
security and involve farmers categorized under the food security domain.
86. Zonal and national MSIPs will be established by NAADS and NARO and involve
farmers, AASPs, NARDIs, ZARDIs, input suppliers, and others involved in the specific value
chain. A multi-stakeholder analysis of technology and advisory service needs associated with the
selected enterprises will be done at district and zonal levels to ensure that: (i) farmers understand
the enterprises they are dealing with in terms of production and profitability; (ii) the production
constraints (current and potential) to be overcome are well identified; and (iii) specific issues for
extension and research are dealt with by NAADS and NARO, respectively. The NAADS
coordinators at the subcounty, district, and the zonal levels will facilitate and promote the
participation of all key players in the multi-stakeholder platforms for participative planning and
reviewing processes at their respective levels.
67
87. Farmers and their organizations must have stronger capacity and tools to select and
manage viable enterprises. Studies on enterprise profitability, market analyses, and enterprise
complementarities will be undertaken for each AEZ. Based on their findings, a short training
program will instruct district and subcounty NAADS coordinators and SMSs in enterprise
analysis, market potential, agricultural production zoning and social inclusion. Training will be
participatory and enable participants to gain hands-on experience in training others. The resulting
capacity is expected to help staff overcome the inefficiencies experienced in Phase I during the
enterprise selection processes. This set of activities will be outsourced to competent service
providers, who will be required to provide a harmonized, consistent program across the country.
Activity 3.2.2: Appropriate agricultural advisory/knowledge services delivered to farmers39
88. Consolidating the achievements and lessons from NAADS Phase I, ATAAS will support
initiatives by men and women farmers, working in groups, to access agricultural advisory
services from professional and certified contracted AASPs.40 ATAAS will also pilot innovative
methods for delivering services.
89. Services will continue to be provided largely through public funds, with a co-payment by
farmers (3 percent) and subcounty GoU (5 percent) as a step towards sustainability and to
inculcate ownership and accountability. To finance the remaining 92 percent of costs, conditional
grants will be channeled through subcounty governments to farmer fora to finance advisory
service contracts. Services contracted under this mechanism will consider general demand-driven
agricultural extension and technical advisory services for selected enterprises identified by
farmer groups, including for marketing and business planning.
90. AASPs will be engaged under performance-based contracts. At the district level, all
NAADS activities will be coordinated by the DNC. Based on the needs assessed by NAADS,
each subcounty will have a full-time SNC on a long-term contract (3 years) and the equivalent of
three full-time professional and certified AASPs on performance-based contracts to deliver
advisory services. Two persons (one each for crops and livestock) will be on longer term
contracts (2 years) and will be complemented by short-term specialized service providers
contracted as needed (up to an equivalent of one full-time contract in terms of funding). The
Community Based Facilitators, drawn from the farmer groups, will be trained as farmer advisor
to maintain continuity in service delivery and increase the outreach of AASPs by enhancing
farmer-to-farmer knowledge sharing. Members of farmer groups who show leadership, have
considerable motivation, and adopt technology early will be identified by group members to
become CBFs.41
91. The GoU has decided to streamline agricultural extension within NAADS. That is,
extension and advisory services will be under the NAADS program. All subcounty employees,
39
According to the NAADS Act (2001), advisory services mean the provision of guidance to farmers or farmer
groups with regard to the operation and management of their farming enterprises. It is proposed to revise this
definition to the following: advisory services mean guidance and support to farmers or farmers groups with regard to
the operation and management of their farming enterprises as a business, including post-harvest handling, value
addition and marketing.
40
Service Provider of agricultural services means a person or body contracted to deliver advisory services,
according to the NAADS Act (2001).
41
According to the NAADS Act, CBF means a farmer nominated by a farmer group and appointed by the
subcounty farmer fora to train and backstop other farmers.
68
and in particular the remaining frontline extension workers, not engaged under NAADS will be
re-assigned to non-extension functions, such as pest and disease control, regulation, quality
assurance, planning, data collection, etc., as will be further defined in the ongoing MAAIF
institutional restructuring process. Under the NAADS program, the hiring of DNCs, SNCs and
AASPs will be through an open, transparent and competitive process, with the full involvement
of farmer fora and other farmer representatives. All current front-line extension workers, except
those who have been involved in malpractices and misuse of funds, who are qualified (in terms
of meeting the established minimum level of qualification and standards of service provision)
will be eligible to compete for these contracts. Clear evaluation criteria and modalities which
will be articulated in the guidelines to ensure that SNCs and DNCs as well as AASPs are subject
to binding performance reviews by farmer fora and farmer groups.
92. Different approaches to deliver services will be piloted. Participatory approaches such as
farmer field schools will be tried in an action research mode, and new approaches such as
market-oriented extension services introduced. NAADS will partner with individual farmers,
private entities, and/or public institutions to provide practical skills to different categories of
farmers and to ensure the success of their farming enterprises.
93. Although the most popular mode of delivery of advisory services is in person, the limited
availability of AASPs requires the use of other communications media, such as radio, video, and
mobile telephones to ensure adequate coverage of farmer needs. A number of initiatives using
mobile telephones are already being piloted in Uganda. AASPs can also access databases of
agricultural technologies online, such as FAO's Technologies for Agriculture database, which a
private company is piloting for information dissemination. In the first year of ATAAS, a
consultancy will develop a strategy for NAADS to pilot innovative approaches that do not
depend on direct contact between farmers and advisors by using ICT (see subcomponent 2.5).
94. Under ATAAS, activities to enhance farmers' awareness of improved technologies
produced by the NARS or adapted from other sources will be intensified to broaden and deepen
their use. AASPs will facilitate demonstrations of technologies tailored to the farmer categories.
These demonstrations serve as farmer learning platforms, and (as noted) the DARSTs and/or
ZARDI scientists will develop AASPs' ability to conduct them. These partnerships will also
develop AASPs' ability to advise farmers on multiplying new livestock breeds or seed and
planting material, especially for cultivars of vegetatively multiplied crops, including the
establishment of mother gardens by enterprising farmers.
95. The development of local content and farmers' participation in that process will be
facilitated by AASPs and supported by the DARSTs (who will in turn receive support from
ZARDIs). The knowledge and information generated for a particular technology will be collated
at the subcounty level and managed at the district level in the form of information for extension.
At the national level, the NARO and NAADS Secretariats constitute a standing body that will
gather, process, and assure the quality of information to be made available through different
media, including the internet and other mobile platform services.
Subcomponent 3.3: Technology Uptake Grants
96. Following the lessons learned in Phase I, NAADS will differentiate its support to
different categories of farmers to foster their progression from subsistence to market orientation.
NAADS will achieve its objectives (such as farmer-to-farmer knowledge sharing, better access
69
to new technologies, and market integration) by providing specific learning platforms adapted to
different categories of farmers. Under ATAAS, farmer groups will be eligible for two types of
grants to support food security objectives and promote the development of market-oriented
enterprises respectively. In addition, at the national level, NAADS Secretariat will undertake
strategic investments to introduce and facilitate new or improved technologies. Detailed
implementation guidelines for these grants will be developed and included in the PIM. The
guidelines will also be clearly communicated to all stakeholders, including the implementers at
the LG level, farmer groups and farmer fora. These guidelines will incorporate the recommended
actions and practices from the ATAAS GAC program (given in Annex 9).
Activity 3.3.1: Food Security Technology Uptake and Multiplication Grant
97. Food Security Grants will support enterprises directed at achieving food security. Each
farmer group will receive an annual grant (on average about UShs 375,000) to establish a
technology demonstration and multiplication site for a food security enterprise identified by the
group as a high priority. The group will collectively identify each year a different host farmer for
this enterprise (the Food Security Farmer), who will implement the demonstration and planting
material multiplication for the group. The individual hosting the enterprise will repay group
members under terms and conditions to be decided by the farmer group, with the proviso that the
in-kind repayment be no less (in monetary equivalent) than the original support provided to the
host. For vegetatively propagated and orphan crops that lack a viable commercial seed market,
this mechanism will initiate farmer-based multiplication process to facilitate farmers' access to
improved varieties. Detailed implementation guidelines and selection criteria for this grant will
be developed as part of the PIM.
Activity 3.3.2: Market-Oriented Enterprise Promotion Grant
98. Farmer groups will also receive grants to promote promising technologies for high-
priority market-oriented enterprises. The group will receive a grant (on average about
UShs 750,000) to establish a demonstration site for one enterprise per year for a maximum of
four years (including, where this is the case, support given during NAADS Phase I).42 During the
support period, each farmer group will annually identify a different market-oriented farmer(s)
from within the group to host a demonstration of the technology selected by the group. The host
farmer(s) must pay 70 percent of the value of the inputs received (in cash) into the group account
with an accredited financial institution. Criteria for receiving this grant include a satisfactory
evaluation of the performance and repayment of the previous (for the initial year) or current
outstanding (for subsequent years) grants made to the group. Detailed implementation guidelines
and selection criteria for this grant will be developed as a part of the PIM by the date of project
effectiveness.
COMPONENT 4: SUPPORTING AGRIBUSINESS SERVICES AND MARKET
LINKAGES (US$ 63.0 million: US$ 47.5 million from GoU, US$ 11.5 million from IDA, and
US$ 4.0 million from other DPs).
99. This component will help reorient farm enterprises as farm businesses, enhance farmers'
access to production support services, provide support services in business development to
42
Every year the farmer groups would nominate different market-oriented farmer and enterprise.
70
emerging entrepreneurs and agri-businesses, and establish a Commercializing Challenge Fund
(CCF) to support promising initiatives to enhance market linkages and value chain development.
Subcomponent 4.1: Agribusiness Development Services
Activity 4.1.1: Farm enterprises developed as businesses
100. This activity will strengthen farmers' and implementers' appreciation of the importance
of targeting enterprises by agro-ecological conditions, farmers' resource endowments, and
market opportunities. The selection of enterprises will be improved by building the capacity of
farmers and implementers at the subcounty and district levels.
101. Stakeholders at all levels overwhelmingly support farmers' participation in selecting
enterprises for development. They perceive farmers' participation as important for strengthening
their capacity to generate and share knowledge, for agreeing on actions to be taken, and
increasing the probability of success. Under ATAAS, enterprises will be selected more
effectively and efficiently by taking the following actions in most districts and subcounties:
(i) Implementation guidelines will indicate how long the enterprise mentoring process will
continue. Most stakeholders reported that the time allocated for selecting enterprises was
insufficient. When the implementation guidelines are reviewed, the length of this process
should be determined on a practical basis and an appropriate length of time recommended
in the guidelines.
(ii) During consultations with stakeholders, it became evident that farmers in some areas
lacked the experience and resources to sustain high-value enterprises.43 High-value, non-
traditional commodities can help farm households generate more income per unit of
resources used on the farm, but usually they are associated with greater production and
market risks than poor, small-scale farmers can bear. For many small-scale farmers, the
transition from subsistence crop production to commercial staple crop production is far
more pertinent than a complete shift to specialized, high-value, and exotic commodities.44
To avoid this problem, farmers will be categorized on the basis of agro-ecological
production potential and risk preferences, and target support that suit their needs. Such a
targeting strategy should also enhance social inclusion. Uganda currently enjoys great
comparative advantage in the regional market because of its favorable climate and
strategic location. By targeting enterprises that have regional market potential, the
proposed project can increase farmers' access to markets and incentives.
(iii) Farmers will receive information on market prospects and gross margins to make
informed choices. When farmers can select enterprises more transparently, based on
better access to information, they can also resist manipulation.
102. The capacity to select enterprises will be built at subcounty workshops where farmer
groups will learn to conduct simple profitability analyses of the costs and potential profits of
proposed enterprises. District and subcounty technical staff (NAADS Coordinators and/or
43
Most of the stakeholders were concerned that some farmers selected enterprises out of a sense of excitement rather
than out of an understanding of the cash required to sustain enterprises once the year of support ended.
Representatives of farmer forum reported that some enterprises were too expensive for farmers to maintain.
44
It is perplexing that poverty-stricken and knowledge-constrained farmers will immediately adopt risky money
makers such as aloe vera, moringa, and jatropha.
71
AASPs) trained in enterprise selection will facilitate the workshops. When selecting enterprises,
farmers will use the information on market trends, production requirements, and competitiveness
gathered through the research described in the previous paragraph. Once farmers are convinced,
they will nominate enterprises of their choice within their groups. The nominated enterprises and
all information emanating from the group enterprise selection process will be compiled and
prioritized by the subcounty farmer fora for support during the year.
Activity 4.1.2: Farm level business skills developed.
103. Enterprise development requires more than selecting the best enterprises in the most
efficient way. Farmers' skills in business and market analysis need continuous upgrading. Under
this activity, district and subcounty coordinators, district commercial officers, district trade
development officers, and community development officers will participate in short training
programs at the national and district levels to acquire the business skills to develop and manage
an enterprise at the farm level. Training will be done by specialized service providers
104. These newly trained district and subcounty staff with then train farmers in business skills
and resource mobilization (through savings and credit management as well as access to
agricultural input suppliers). Training manuals will be translated into major local languages and
expert farmers identified and equipped with training manuals to backstop others farmers. This
strategy is expected to enhance the local capacities and make the delivery of agribusiness
advisory services more efficient. Participation of district and national technical staff in
supervision and mentoring will gradually diminish as local capacity gains strength.
Activity 4.1.3: Access to agribusiness support services enhanced.
105. These activities aim to improve the density and effectiveness of production support
services for commercial agriculture to emerge. ATAAS will help develop mechanisms to reduce
constraints imposed by poor access to financial services for agribusiness investors, the scarcity
and inefficiencies of agro-input dealers, and market information asymmetries.
106. Linking small-scale farmers to MFIs. To increase savings among farmers and enable
them obtain micro-credit with group savings as the guarantee, under ATAAS farmer groups'
capacity will be strengthened to deal with rural-based financial institutions. The problem of low
savings in rural areas will be addressed by mobilizing and sensitizing farmers, especially
technology matching grant beneficiaries, to boost the number of savers in financial institutions in
the rural areas. This effort will increase rural savings, increase the loan portfolio for rural
financial institutions, create more incentives for financial institutions to expand their rural
financial services, and ultimately increase farmers' access to rural credit.
107. Enhancing access to credit services for investment in value chain development (medium-
scale agribusinesses). With financial support from the GoU and its development partners, a
number of financial institutions have established agricultural credit windows (see Working
Document 2 in Annex 14), but these financial services and the associated terms are not
publicized sufficiently to the target clients. Even when they are aware of these financial services,
the majority of target clients cannot meet the requirements of the financial institutions. To reach
out to potential clients and enable these facilities to be used more effectively, NAADS under
ATAAS will link with these financial institutions to compile information on their services,
lending portfolio, and terms. That information will be packaged in a form that the intended
clients can understand and made available to them through information mechanisms established
72
by NAADS and the collaborating financial institutions. The target clients include private
agribusinesses45 and HLFOs whose businesses require substantial capital investment. An
appropriate service provider will be contracted to undertake the activity.
108. In addition, NAADS will help agribusinesses develop bankable business plans so that
they can approach financial institutions for credit. The development of the business plans will be
guided by outsourced technical skills on a cost-sharing basis.
109. Improving the efficiency of agro-input dealers. Technical training of local agro-dealers
will complement business skill and environmental and pesticide management safeguard training
provided by other ongoing projects and strengthen their advisory capacities to farmers.
Technology demonstrations (of varieties, inputs, and so forth) also need to be supported together
with the private sector at agro-dealer outlets. To provide agro-dealer support services and
capacity building, NAADS will forge collaborations with associations of input dealers, such as
the Uganda National Agro-Input Dealers Association and Uganda Seed Trade Association, and
with ongoing initiatives and agribusiness programs/projects supported by other development
partners or agencies. The collaborating partners could provide training, accreditation, and
enforce a code of conduct for agro-input dealers.
Among other services that agro-input dealers' associations offer to their members is market
information and provision of credit guarantee schemes to enable them to access inputs on
consignment. NAADS will contribute to this effort by providing information to the associations
on the emerging markets identified by the farmer fora in their respective zones and associated
opportunities.
Activity 4.1.4: Market information provided.
110. Production and market information is a key link in the value chain from farmers to
markets. Market information will be directed to three categories of users: producers, agribusiness
entrepreneurs, and policy makers. Farmers require market information on current price trends
rather than hindsight from the last season to make better decisions on which enterprises to
pursue. The present and future agribusiness entrepreneurs need information to stimulate and
guide day-to-day decision making. Policy makers and program managers also require
information as a tool in policy formulation and program management. Different categories of
users require information in different format and packaging, which in turn requires different
skills. The information will not be restricted to these particular groups of users, but it will be
targeted to them to meet their particular needs.
111. At the beginning of ATAAS, information on target markets will be synthesized to
identify information gaps, constraints that need to be addressed, prospects for success, and risks
that should be managed. This work will be done at the national level by professional services
outsourced in a competitive procurement procedure. Market studies will be conducted annually
to assemble information. At the same time, the capacity of subcounties and districts to regularly
collect and collate production information while building on existing information on value chains
will increase. These activities will be facilitated at the national level in collaboration with the
districts, and they are also in line with the DSIP. More information will be generated through the
MIS as described in subcomponent 2.4.
45
The target agribusiness firms include agro-inputs dealers/importers, agro-processors, commercials farms, and
value addition activities that require heavy investment, such as storage facilities and transportation.
73
112. Market information will be disseminated primarily through collaboration with the
qualifying market information agencies. FIT Uganda and Agrinet, among others, are professional
agencies currently generating and disseminating market information, with support from Danida­
Agriculture Sector Program Support (ASPS), and FAO, respectively. They are use a combination
of channels to reach diverse users in Uganda, though the scope of content is still reportedly
limited. NAADS will collaborate with these institutions and other market information agencies,
including through PPP arrangements, to expand information dissemination. These institutions
will also be linked to other information-generating mechanisms of NAADS to expand the scope
of information they disseminate.
Activity 4.1.5: Business development support services provided.
113. Business development services are essential to improve the performance of enterprises,
access to markets, and ability to compete. The critical lack of these services needs to be
addressed under ATAAS to improve the efficiency and competitiveness of agribusinesses in
areas such as agro-processing, input supply, and produce marketing. Agribusiness entrepreneurs
also need business development services to qualify for credit. Business development service
providers (BDSP) with the necessary skills are few. Nor agribusiness entrepreneurs are well
informed about the importance of these services in the development of their businesses. The
capacity of BDSPs with limited skills must be increased to meet the needs of agribusiness
entrepreneurs. Capacity building will seek to increase the number of competent, skilled providers
of business development services through short-term programs conducted in collaboration with
universities and other competent institutions on a cost-sharing basis. BDSPs that already possess
the requisite skills will be hired on retainer46 to backstop and mentor capacity building services
for less-skilled BDSPs to increase the overall quantity and quality of BDSPs. The contracting of
BDSPs will primarily be a function of the NAADS Secretariat.
114. The capacity of agribusiness entrepreneurs will be enhanced through sensitization on the
importance of business development services and training. The trained BDSPs will be contracted
at district and national level to train and mentor the agribusiness entrepreneurs in business
development services. They will be backstopped by the skilled BDSPs on retainer as part of
capacity building.
115. The provision of key business development services (such as the preparation of business
appraisals, development of marketing plans, preparation of bank loan applications, and provision
of advice on financial and legal matters) to agribusiness entrepreneurs is expected to improve the
efficiency of agribusinesses and improve their performance. The experience of other projects--
such as USAID's Support for Private Enterprise Expansion and Development, Danida ASPS,
Private Sector Foundation­Business Uganda Development Services, and Enterprise Uganda--
indicates that the demand for business development services is extremely limited when there is a
cost-sharing element, but it is also a very useful filter. NAADS will fully sponsor the initial
service to stimulate investment in agribusinesses, but participants will be screened carefully.
Subsequent services will be provided to the client on an escalating cost-sharing basis Support for
business development services will be managed at the Secretariat level, with the districts playing
complementary roles. Farmer organizations and HLFOs also require business development
46
Under this arrangement, service providers commit to providing services on call and are paid a regular minimal fee
(retainer) on a monthly basis.
74
services and follow-up mentoring in output and input bulking and marketing and in handling
financial transactions.
Subcomponent 4.2: Establishing a Commercialization Challenge Fund
116. NAADSs' core mandate in agribusiness development is to integrate smallholder farmers
into value chains. Most value chains are not yet fully developed or efficiently managed to allow
smallholder farmers effectively link with profitable markets. To facilitate progression of farmers
towards commercialization, building on Ugandan and international experiences (see Working
Document 3 in Annex 15), ATAAS will establish a CCF to provide matching grants, on a
competitive basis, under two windows: one at the national level to promote linkages with
established value chains, and the second at the subcounty level to support promising
opportunities for commercialization, including marketing, value addition or agroprocessing. It is
important to note that this support will be provided on a competitive basis and will not be an
entitlement to any individual or any group.
117. Partnerships between the public and private sectors can be critical for improving market
linkages by helping improve the quality of services and manage business risks through additional
investment and improved management. The guiding principle for CCF support is to build
capacity and facilitate smallholders to profitably integrate into value chains. ATAAS will
promote this objective through:
(a) Support for the development of farmer institutions (groups and associations) to link
to the identified or existing agro-processing, marketing or value addition activities.
(b) Improve farmer access to specialized technologies for identified value chains, and
improved technologies through effective technology multiplication
(c) Improve the marketability of farmers' produce through improved quality,
standardization and bulking.
(d) Increase competitiveness of agribusinesses through improved product quality,
management, standardization, and certification.
118. Other development partners have been using, and continue to use, various grant funds in
a similar manner, including USAID (formerly IDEA and APEP, presently LEAD and
SPRING),47 ACDI/VOCA Title II, and Danida (ASPS II). New programs such as IFAD's
Vegetable Oil Development Project 2 and Danida's U-Growth (a business and agriculture sector
support program) also have equivalents of the challenge fund in the form of PPPs linking the
private and smallholders. NAADS will learn from these programs in operationalizing its
Challenge Fund.
119. At the start of ATAAS implementation, a consultancy will be commissioned to develop
the detailed design for the Fund, including governance, organizational, and operational details to
implement and monitor the Fund; provisions to build capacity among potential beneficiaries; and
a communications strategy. Clear guidelines will be developed, which will include rules,
procedures, criteria for access, and processes for application and evaluation of the proposals. The
consultancy will also put in place instruments and guidelines for risk management in
47
IDEA Investments in Development for Export Agriculture; LEAD Livelihoods and Enterprises for
Agricultural Development; SPRING (Stability Peace and Reconciliation in Northern Uganda; ACDI/VOCA,
Agricultural Cooperative Development International and Volunteers in Overseas Cooperative Assistance.
75
partnerships to be supported by NAADS. The capacity of the committees to evaluate proposals
will be enhanced by evaluation procedures that emphasize risk analysis to reduce risks and
ensure that partnerships succeed. Cost-sharing will be a requirement to enhance partners'
commitment and improve the probability of success. Prior to disbursements from the CCF,
NAADS will develop a manual with the detailed design and clear implementation guidelines for
both windows of the CCF.
Activity 4.2.1: Window 1 for PPPs established at the national level.
120. Objective. The CCF window at the national level will support PPPs to integrate
smallholder farmers into value chains through forging partnership and improving
competitiveness of agribusinesses and farmers linkage to market. Farmer groups, nuclear
farmers, agro-processors, traders, and other agribusinesses will be eligible for support in the form
of a matching grant to stimulate production or processing from NAADS groups. They will offer
specialized, professional advisory services to farmers as well as provide access to improved
technologies, bulking facilities, and links to higher levels of the value chain.
121. Two levels of PPPs. To promote the development of links in value chains at different
levels, as well as accommodate value chains ­ and the associated PPPs ­ of varying scope and
scale, Window 1 will provide support to PPPs at two levels. The first will support medium to
large scale PPPs between agribusinesses and out growers/farmer organizations. The second will
target small-scale PPPs to link smallholders with emerging or existing nucleus farmers. The
targeted beneficiaries of the CCF are (a) smallholder farmers and their organizations, and (b) the
private sector, including nucleus farmers, agribusinesses, and traders. Each entity (individual,
group or business) would be able enter into a partnership under the CCF only once during the
ATAAS implementation period.
(a) Medium to large scale PPPs. The project would support about 30 medium to
larger-scale PPPs, or about 10 in each of the first three years of implementation. Each
PPP is expected to have a three year implementation cycle to allow long-term
partnership to be formed and maintained. The average grant is projected to be
US$ 100,000, ranging from US$ 50,000 to US$ 200,000.
(b) Small-scale PPPs. The project would support about 300 nucleus farmers through
small-scale PPPs, or about 100 in each year of the first three years of implementation.
These partnerships will also be expected to span a 3 year period to foster sustainable
integration of farmers into value chains. The average grant is projected to be
US$ 15,000, ranging from US$ 10,000 to US$ 20,000.
122. Co-financing. The matching grants would finance 50 percent of total investment while
the counterpart funding would finance the remaining 50 percent, which will be fully costed in the
business and investment plan. Both the grant and counterpart funding will be on an incremental
basis. When investment is made for company-owned equipment, the company needs to finance
at least 50 percent of the equipment cost. ATAAS will promote good practice of unbundling the
total investment cost, with the partner financing the total cost of equipment and the grant used to
support the training and servicing costs.
123. Benefit sharing. To ensure that farmers gain a fair share from the benefit of the
partnership, one of the criteria in the evaluation of the PPP proposals would the inclusion of a
transparent and fair contractual arrangement between the farmers and companies, and a sound
co-financing scheme. As a principle, at least 50 percent of the grant shall be used to support
76
small holder farmers' activities and farmer owned assets, while no more than 50 percent of the
grant shall be used for companies' activities and company owned assets. Farmers and farmer
groups will be helped through capacity building to be able to deal with companies in a more
professional way and to enhance their bargaining power.
124. Institutional arrangements. The final arrangements for CCF Window 1 will be designed
at the beginning of the project implementation as described above. Among the key design
features will include the following selection and evaluation process of the CCF under Window 1
will be outsourced, including advertising, invitation for proposals, a blind review and evaluation
of proposals, mid-term-review, and end-of-project impact evaluation. This is to ensure
transparency, fairness and independence in the selection process. Priority setting, developing
criteria, final approval, supervision of partnerships, and M&E will remain the responsibilities of
NAADS Secretariat and local governments. There are strong existing capacity and professional
management specialists in Uganda to manage matching grants.48 The implementation bodies for
Window 1 would include (but not be limited to) the following:
(c) Steering committee: The Steering Committee for the CCF comprised of
representatives from NAADS, MAAIF Headquarters, at least two representatives
from the private sector and one from the national farmers forum would be responsible
for identifying investment areas, providing strategic guidance and oversight of the
CCF, outsourcing of the necessary services implemented at national level, approval of
work plans and budgets, receiving progress reports and ensuring the transparency in
the implementation of the CCF. The Committee will also be responsible for approval
of selected partners based on the recommendations from the selection agency.
(d) CCF Selection Agency: There are strong existing capacity and professional
management specialists in Uganda to manage the competitive selection process for
partners to be supported with matching grants. Under Window 1, therefore, a number
of activities will be outsourced to a competent agency which will be responsible for
the full selection process outlined above.
(e) Award of contracts: The recommendations by the CCF Agency based on its
comprehensive evaluation of the received proposals will be submitted to the steering
committee for review and final approval. The NAADS secretariat will thereafter enter
into partnerships with the selected partners.
(f) Appeals: Appeals will be submitted to steering committee for final verdict. If
necessary the selection process will be revisited following the decision of the steering
committee.
(g) Implementation and review of partnerships (Contracts): After the contracts have
been awarded, the management and oversight of the implementation of the
partnerships (contracts), including technical follow up, supervision, quality control,
and regular monitoring will be the responsibility of the agribusiness department of
NAADS. The Agribusiness Manager, supported by the Enterprise Development
Officer and the Product Development Support Officer, will be responsible for the
48
Examples include Oil Palm Uganda Ltd (OPUL), Mukwano in oilseeds, Nile Breweries in sorghum, East African
Breweries Ltd in barley, the Kibinge Coffee Farmers Association, and Tri-Star in textiles.
77
supervision and management of the partnerships.49 M&E for the PPPs will be
integrated into the overall M&E arrangements for ATAAS, and will include the
following key indicators:
(i) increase in the value of sales from farmers participating in partnerships with
agribusinesses
(ii) reduction in post-harvest losses by those farmers benefiting from improved
accessibility as a result of the newly built infrastructure under the project
(iii) increase in the quality (as measured by price premium) of the produce sold by
participating partnerships
(iv) number and percentage of partnerships still exist and operational.
(h) Eligibility criteria: The basic principles underlying the eligibility and evaluation
criteria will include:
(v) Farmer outreach: A contractual arrangement with farmers/farmer groups for
the partnership needs to be made before the approval of the proposal with a
minimum number of farmers participating in any farmer
organizations/partnerships. A business and investment plan shall be jointly
prepared by the business partner and farmers/farmer groups.
(vi) Innovative features: The proposals must be innovative in one or more aspect:
technological innovation, institutional arrangement, or pubic goods element.
(vii) Economic/Financial/Technical aspects: The business and investment plan
demonstrates long term economic gains and is financially and technically
sound, viable and sustainable, and
(viii) Additionality: An important criterion is that the matching grants provided for
PPPs induce new or additional investment that the private investor would
otherwise be unlikely to undertake. This is critical to ensure that project
interventions do not result in market distortions, and that the public
contribution to private investment activities are justified on the basis of
additional economic gains with sufficient externalities.
(ix) Environmental aspects: Positive environmental impacts would earn extra
points for project proposals (e.g., for the use of environmentally friendly
technologies, erosion control measures), while the selection criteria would
safeguard against activities that may lead to negative environmental impacts
(e.g., increased soil erosion, excessive use of chemicals) or have mitigation
plans in place to ensure the environmental safeguard policy is complied with.
(x) Social inclusion: The proposal evaluation criteria would give extra points for
the following socials aspects: gender development, targeting the poor and
disadvantaged groups. For example, eligible proposals from women headed
businesses and households would be given extra points in the evaluation
weighting system.
49
Based on the experience gained the first year of implementation, specifically with respect to the workload for the
effective supervision and monitoring of PPPs most of which are expected to be spread out over the country, the
decision on whether to outsource of CCF supervision and monitoring will be revisited.
78
125. Eligible expenditures. The matching grants would meet, on an incremental basis, the
costs of advisory services and training for farmer organizations/farmers and the respective
agribusiness partners; goods, materials and on-farm works to increase production and
productivity, and post-harvest handling undertaken by smallholder farmer organizations/farmers.
Ineligible expenditures would include expenses related to (farm) land, family labor contribution,
working capital, recurrent expenses, normal business costs, tobacco and its related
products/services, alcohol and narcotic drugs and their related products/services, gambling and
its related products/services, and technologies which infringe with the existing laws and
regulations on patents and copyrights.
Activity 4.2.1: Window 2 for Commercializing Farmers at the local level
126. Objective. The second window of the CCF will be established at the sub-county level to
encourage the progression of farmers from subsistence and lower initial level of market
orientation to full-scale commercialization of their farming activities. This matching grant will
help emerging or existing participants at the lower end of the value chain address a suite of
activities to strengthen specific links in the value chain, thereby getting over the narrow focus on
a single or uncoordinated intervention. It will also help leverage additional resources from
strategic investors, institutions, development agencies, and the GoU. Key areas of interest
include scaling up technology adoption, improved market linkages, primary agro-processing,
providing specialized advisory services, developing innovations and platforms for information
and knowledge sharing, strengthening farmer organizations, and supporting focused value chain
platforms. The CCF will contribute capacity building resources to support these activities, which
include risk mitigation, agro-processing, bulk marketing, value addition and social inclusion.
127. Prospective Partners. Commercializing farmers, identified and selected by the members
of the farmer groups at subcounty level, and farmer groups or associations, will be selected
through competitive process. The selected partner will act as focal point for learning, quality
control, product standardization and bulking for selected commercial enterprises. About 14
farmers per sub-county will be supported each of the first three years of the project. The average
matching grant will be US$ 750 per PPP with a co-financing requirement of 50 percent of the
proposed investment cost on an incremental basis. At the Mid-Term Review, an evaluation of the
scheme will be conducted to assess its performance and decide on its continuation.
128. Institutional arrangements. Farmer institutions (including farmer groups, farmer fora
and farmer associations), local government, private sector and civil society organizations will be
the key institutions in implementing the CCF at the local level. Farmer group(s) will identify the
investment areas (based on market and business principles) using established criteria. Areas that
meet the pre-qualification criteria, to be assessed by the farmer fora, will be advertized for
inviting proposals for funding. Prospective applicants (individuals selected and nominated by
farmer groups, farmer groups themselves or their associations) will submit applications to be pre-
qualified by the sub-county farmer fora. The shortlisted applicants will be invited to submit
business proposals, and with support provided by NAADS through specialized service providers
to help develop these proposals. These proposals will be evaluated by a District Evaluation
Committee comprising of the DPO, two members of the District Farmers Fora, at least one
representative of the private sector, at least one representative of the civil society or NGO, the
District planning officer, the District Commercial Officer and the DNC. The supervision and
monitoring will be undertaken jointly by the Farmers Fora and Local GoU officials.
79
129. Co-financing. The matching grant would provide 50 percent of the proposed investment
and the contribution of the recipient would be on an incremental basis. The grant would be for
eligible expenses for technologies and services, and the recipients would be expected to repay 70
percent of the grant proceeds to the farmer group accounts. The procurement process will be on
the basis of simplified community procurement procedures, to be developed prior to
implementation of the challenge fund.
130. Eligibility Criteria. In evaluating the business proposals, the Evaluation Committee will
take into account the criteria to be developed as part of the proposed consultancy to establish the
challenge fun. The following good practice criteria to be considered: (i) objectives and eligibility
of the project; (ii) profitability of the project; (iii) clarity of the proposal; (iv) capacity to translate
farmers challenges into opportunities; (v) number of farmers likely to be linked to markets; (vi)
demonstrated capacity for enterprise mix or greater specialization; (vii) capacity to provide
technical advisory and business development services, among others.
131. Contract Management and Supervision. Once approved, the contracts will be managed
by local governments with supervision from the Agribusiness Department of NAADS. Technical
follow and supervision will be provided by the District Production Departments, and quality
control by DNC and SNC. Monitoring and supervision will be the responsibility of the farmer
fora in collaboration with the subcounty local GoU and coordinated by the SNC.
COMPONENT 5: PROGRAM MANAGEMENT (US$ 74.5 million: US$ 56.2 million from
GoU, US$ 13.6 million from IDA, and US$ 4.7 million from other DPs).
Subcomponent 5.1: NARS Coordination and NARO Management
132. Agricultural research is coordinated and managed by NARO. The NARO Secretariat will
implement ATAAS research activities through the NARS, under the oversight of the NARO
Council. NARO Secretariat will be supported to construct training facilities, replace old vehicles
and office equipment, as well as facilitated with overhead and operating costs to develop a
NARS-wide capacity and competencies development program for market-oriented research,
environmental issues, gender mainstreaming, and working in multi-institutional and inter-
disciplinary teams. This program would strengthen policies, guidelines, standards, processes,
quality control, and stakeholder capacity building. An incentive scheme to enhance performance
and retention of research staff in both NARIs and ZARDIs will be developed and implemented.
In support of greater sustainability, ATAAS will support technical assistance for NARO
Secretariat to explore the options for strengthening the financial resource base, such as non-tax
revenue generation, establishing an Agricultural Research Trust Fund (ARTF) to attract funds
from potential donors, co-financing of CRGs, and the development of NARO as a quality
brand.
133. Staff capacity of NARO needs to be strengthened to fully implement ATAAS activities.
The staffing levels across NARO are currently 5 percent below the target for 2010/11 as per its
five-year staffing strategy to reach the levels approved during the NARS reforms. This has been
largely due to a binding MTEF ceiling to accommodate additional staff salaries. Under ATAAS,
the GoU has committed to increase its budget allocations for NARO from the current proposal of
UShs 29 billion to UShs 36 billion for 2010/11 (see Table 5-D, Annex 5). The allocation will
increase to UShs 50 billion in 2011/12 and are thereafter expected to grow in line with the GoU
commitment of increased funding to the agricultural sector by 10-15 percent a year for the
80
remaining three years. These allocations, along with ATAAS DP financing will permit NARO to
fill all its vacant positions, as per its current staffing plan (dated April 2008), by December 30,
2010, and thereafter implement its time-bound staffing strategy.
Subcomponent 5.2: NAADS Management and Coordination
134. The NAADS program is managed and coordinated by the NAADS Secretariat.
Established institutional entities at all levels of GoU will be supported to coordinate and
administer ATAAS-financed activities managed by NAADS. At the national level, this support
will include maintenance of the NAADS Board and Secretariat. The NAADS Board and
Secretariat, under the policy guidance and oversight of MAAIF Headquarters, will continue to
manage the program according to the NAADS Act, setting standards through the issuance of
operational guidelines, providing a regulatory framework for AASPs by setting and enforcing
standards for qualification and performance, and developing model contracts. NAADS will place
one Zonal Coordinator and a program officer at each ZARDI to improve the efficiency of the
NAADS Secretariat in managing the program and promote more effective partnerships with
NARO.
135. Activities at the district and subcounty levels are managed by the LG, under the
coordination of District and Subcounty NAADS Coordinators. These individuals will be
supported to facilitate the program's farmer-led planning and implementation processes. They
will also work closely with NARO and technical staff at the district level for quality assurance
and technical support. These positions are mainstreamed into LG structure, and they will support
the facilitation, coordination, and oversight of service contracts, grants to farmer groups, and the
CCF. This component will fund the running of the NAADS Secretariat and the program at the
district and subcounty levels, including the provision of vehicles and equipment, employment
contracts, training, program planning and reviews, program audits, and operating costs. In light
of the increased scope and mandate of NAADS under ATAAS, a key action to be completed
prior to starting the implementation of NAADS activities is the approval and implementation of
the revised organizational structure and staffing plan for the NAADS Secretariat, in particular for
the critical functions of procurement, audit and finance.
81
Annex 5: Project Costs
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
Table 5-A: Project Costs by Component (US$ million)
Local Foreign Total
Project Base Cost by Component and/or Activity (US$ m) (US$ m) (US$ m)
Component 1: Developing Agricultural Technologies and 99.3 24.8 124.1
Strengthening the NARS
Component 2: Enhancing Partnerships between Agricultural 51.6 11.8 63.4
Research, Advisory Services and other Stakeholders
Component 3: Strengthening the Agricultural Advisory
Services 249.2 41.6 290.8
Component 4: Supporting Agribusiness Services and Market
Linkages 50.1 11.3 61.4
Component 5: Program Management 54.6 8.9 63.5
5.1. NARS Coordination and NARO Management 9.2 1.5 10.7
5.2. NAADS Management and Coordination 45.4 7.4 52.8
Total baseline Costs 504.8 98.3 603.1
Contingencies 59.5 2.9 62.4
Total Project Costs 564.3 101.2 665.5
Total Financing Required
82
Table 5-B: Project Costs by Component and Basket
Base Cost Total Cost (US$ million)
(contingencies included)/b
UShs US$ % NARO NAADS Total
Component and subcomponent billion million basket basket
Component 1: Developing Agricultural Technologies and
258.2 124.1 21% 137.8 137.8
Strengthening the NARS
1.1. Technology Identification and Development 207.8 99.8 17% 109.2 109.2
1.2. Institutional Strengthening of NARO and other ARSPs 50.4 24.2 4% 28.6 28.6
Component 2: Enhancing Partnerships between
Agricultural Research, Advisory Services and other 131.9 63.4 11% 16.3 56.1 72.4
Stakeholders
2.1. Joint Prioritization, Planning, Adaptive Research/a and
49.2 23.6 4% 4.0 23.2 27.1
Technology Up-scaling
2.2. Sustainable Land Management 17.1 8.2 1% 4.8 4.6 9.4
2.3. Institutional and Human Capacity Strengthening 19.3 9.3 2% 0.2 10.5 10.7
2.4. Joint Results Framework/Monitoring & Evaluation 10.6 5.1 1% 1.5 4.3 5.9
2.5. Joint ICT Applications 35.6 17.1 3% 5.7 13.5 19.3
Component 3: Strengthening the National Agricultural
605.1 290.8 48% 317.8 317.8
Advisory Services
3.1. Farmer Institutional Development 71.3 34.3 6% 39.1 39.1
3.2. Technology Promotion and Farmer Access to
253.2 121.7 20% 143.7 143.7
Information
3.3: Technology Uptake Grants:
100.3 48.2 8% 48.2 48.2
- Food Security Enterprise Grants
180.6 86.8 14% 86.8 86.8
- Market-Oriented Enterprise Grants
22
Component 4: Supporting Agribusiness Services and 127.7 61.4 10% 63.0 63.0
Market Linkages
4.1. Agribusiness Development Services 18.7 9.0 1% 10.5 10.5
4.2. Commercialization Challenge Fund & Grants 109.0 52.4 9% 52.5 52.5
Component 5: Program Management
132.2 63.5 11% 12.7 61.8 74.5
5.1. NARS Coordination and NARO Management 22.2 10.7 2% 12.7 12.9
5.2. NAADS Management and Coordination 110.0 52.8 9% 61.8 61.8
Total Baseline Costs 1,255.1 603.1 100%
Contingencies 129.8 62.4 10%
Total Project Costs 1,384.9 665.5 110% 166.8 498.7 665.5
/a
Costs for adaptive research included in subcomponent 1.1 (NARI and ZARDI on-farm research programs).
/b
The EAAPP provides complementary financing for Cassava, dairy, rice and wheat research and development:
about US$ 22.5 million for research (NaCRRI, NaLRRI, and NARL), US$1.5 million for NAADS, US$3.5 million
for MAAIF and private partners, and US$2.5 million for coordination (NARO/ASERECA).
83
Table 5-C: Project Costs by Expenditure by baskets, categories and financiers
(i) Total ATAAS costs by Financiers (in US$ million)
IDA IFAD EU Danida GEF GoU Total
(1) Goods, works and consultants' services, training,
and Operating Costs for NARO (excluding Part 2(d) of 27.3 3.5 4.9 1.7 3.7 123.4 164.5
the Project as per the Financing Agreement)
(2) Goods, works and consultants' services, training,
Operating Costs for NAADS's Respective Part of the
Project (excluding Subprojects under Parts 3 (d)(i), 54.4 6.5 9.3 3.3 3.5 232.4 309.5
3(d)(ii) and 4 (h) of the Project, and excluding Part
2(d) of the Project50 as per the Financing Agreement)
(3) Subprojects under Parts 3(d)(i) and 3(d)(ii) of the
25.4 2.9 4.1 1.4 0.0 101.9 135.7
Project
(4) Subprojects under Part 4 (h) of the Project 9.9 1.1 1.6 0.6 0.0 39.6 52.8
(5) Refund of Preparation Advance 3.0 3.0
Total 120.0 14.0 20.0 7.0 7.2 497.3 665.5
Percentage contribution 18.0% 2.1% 3.0% 1.1% 1.1% 74.7% 100.0%
(ii) ATAAS: IDA disbursement by year (in SDR million)
2010/11 2011/12 2012/13 2013/14 2014/15 Total
(1) Goods, works and consultants' services, Training,
and Operating Costs for NARO (excluding Part 2(d) of 2.7 3.9 4.2 3.9 3.4 18.1
the Project as per the Financing Agreement)
(2) Goods, works and consultants' services, training,
Operating Costs for NAADS's Respective Part of the
Project (excluding Subprojects under Parts 3 (d)(i), 6.0 7.9 7.2 7.2 7.7 36.0
3(d)(ii) and 4 (h) of the Project, and excluding Part
2(d) of the Project51 as per the Financing Agreement)
(3) Subprojects under Parts 3(d)(i) and 3(d)(ii) of the
3.0 3.4 3.8 4.1 2.4 16.8
Project
(4) Subprojects under Part 4 (h) of the Project 1.7 1.9 2.5 0.3 0.2 6.6
(5) Refund of Preparation Advance 2.0 0.0 0.0 0.0 0.0 2.0
Total 15.4 17.1 17.7 15.5 13.7 79.5
Percentage contribution 19.4% 21.5% 22.3% 19.6% 17.3% 100.0%
50
Part 2(d) to be financed under the GEF Grant.
51
Part 2(d) to be financed under the GEF Grant.
84
Table 5-D: ATAAS: Budget elements for NARO and NAADS baskets
a. NARO basket
Total ATAAS including Contingencies (UShs billion) Total ATAAS including Contingencies (US$ million)
NARO
2010 2011 2012 2013 2014 Total 2010 2011 2012 2013 2014 Total
Comp. 1 54.3 59.9 64.9 58.7 48.9 286.8 26.1 28.8 31.2 28.2 23.5 137.8
Comp. 2 8.4 6.7 6.0 6.0 6.8 33.9 4.1 3.2 2.9 2.9 3.2 16.3
Comp. 5 5.6 5.6 5.1 4.9 5.3 26.4 2.7 2.7 2.4 2.4 2.5 12.7
TOTAL 68.4 72.3 76.0 69.6 60.9 347.1 32.9 34.7 36.5 33.5 29.3 166.8
Disbursements
MTEF 36.0 50.0 55.0 60.5 66.6 268.1 17.3 24.0 26.4 29.1 32.0 128.8
DPs 32.4 22.3 21.0 9.1 3.0 87.7 15.6 10.7 10.1 4.4 1.4 42.2
Balance 0.0 0.0 0.0 0.0 8.7 8.7 - - - - 4.2 4.2
DP% 36.9% 25.4% 23.9% 10.4% 3.4%
b. NAADS basket
Total ATAAS including Contingencies (UShs billions) Total ATAAS including Contingencies (US$ million)
NAADS
2010 2011 2012 2013 2014 Total 2010 2011 2012 2013 2014 Total
Comp. 2 20.6 40.3 19.2 17.3 19.4 116.8 9.9 19.4 9.2 8.3 9.3 56.1
Comp. 3 123.1 124.6 141.0 147.6 124.9 661.3 59.2 59.9 67.8 70.9 60.0 317.8
Comp. 4 32.8 35.1 46.1 9.7 7.4 131.1 15.8 16.9 22.1 4.7 3.6 63.0
Comp. 5 24.8 25.3 25.2 26.2 27.1 128.7 11.9 12.2 12.1 12.6 13.0 61.8
TOTAL 201.2 225.4 231.5 200.8 178.8 1,037.8 96.7 108.3 111.2 96.5 85.9 498.7
Disbursements
MTEF 136.1 150.7 178.2 201 217.8 883.8 65.4 72.4 85.6 96.6 104.7 424.7
DPs 65.1 74.7 53.3 29.2 40.0 262.3 31.3 35.9 25.6 14.0 19.2 126.0
Balance 0.0 0.0 0.0 29.4 79.0 108.3 - - - 14.1 37.9 52.0
DP% 24.8% 28.5% 20.3% 11.1% 15.3% 100.0%
85
Annex 6: Implementation Arrangements
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
1. The objectives, framework, and principles for effective partnerships in the agricultural
sector as set out under DSIP will be further developed and reinforced under ATAAS. ATAAS
and the DSIP recognize and value the role of the DPs (for ATAAS they are IDA, IFAD, GEF,
EU, and Danida) in providing not only resources but also technical assistance, training, and
international experience. The DSIP advocates pro-active and consistent government-led
coordination of DP support. NARP and NAADS, with ATAAS support, will build on this
framework to define, organize, and strengthen their own partnership arrangements. Partnerships
through the mechanisms created under ATAAS are likely to expand as DPs concretize increased
support to Uganda's agricultural sector in the context of the DSIP.
2. Accordingly, with ATAAS support, the NARS will increasingly operate through strategic
partnership arrangements designed to facilitate pluralism in research service delivery, achieve
enhanced efficiency and effectiveness, and make R&D more client-oriented and market-
responsive. NARP therefore involves an innovations systems approach that marshals
complementary institutional competencies in and outside Uganda into stakeholder innovation
platforms to resolve priority constraints. In particular, NARO seeks strategic partnerships along
the technology development continuum to ensure that outputs of basic and strategic research are
translated into applied research for accelerated technology adoption. Key players are the CGIAR
Centers, universities, PARIs, private ARSPs, and NAADS. Product chain analysis will bring
together farmers, traders, processors, researchers, and policy makers into multi-stakeholder
innovation partnerships (MSIPs) for interactive learning and technology dissemination and
adoption, including seed and breed multiplication and distribution. Based on annual work plans
and budgets, performance contracts with NARIs and ZARDIs will be agreed and monitored
directly by stakeholders and through formal M&E. Responsible staff will be trained.
3. Based on an earlier agreed collaboration framework, a special partnership is being
established between NAADS and NARO on planning, value-chain-oriented technology
development, information management, M&E, quality control, and training (see Partnership
arrangements below). This partnership will comprise joint and complementary work on
technology generation and dissemination, including baselines, priority setting, work planning
and budgeting, M&E, ICT, and technology demonstration. Associated joint activities include:
capacity development for participatory research, technology testing and integration,
multiplication of foundation technologies, and establishment of zone-based MSIPs. An MoU or
formal agreement will identify specific areas for collaboration at the national, zonal, and district
levels. The MoU will be based on past experience with jointly operated projects and take into
account NAADS' role as the key facilitator/broker at all levels. The MoU will also cover joint
activities such as training for district staff and private ARSPs, impact studies, and performance
assessment.
4. NARO and NAADS, jointly with IDA and other DPs, conduct a budget planning meeting
by November 30 of each Fiscal Year to discuss the draft annual work plans including annual
procurement plans and draft budget for the following Fiscal Year. The annual work plan and
budget containing the proposed program of activities to be carried out in the following Fiscal
86
Year, along with a financing plan, will be submitted to IDA for approval by January 31 of each
Fiscal Year during the implementation of the Project. A joint annual review of ATAAS
implementation and progress will be undertaken by the GoU together with NARO, NAADS,
IDA and Co-Financiers, and other stakeholders, by May 31 of each year. Overall, the Project
Implementation Manual will be the compendium of all project implementation and institutional
arrangements, procedures and guidelines for all ATAAS activities. Any changes to the PIM,
including the issuance of any new or revised guidelines or instructions substantially affecting the
implementation of project activities shall be agreed with IDA and other DPs in writing and
subsequently included in the PIM.
Implementation of ATAAS through NARO
5. Governance. The respective ATAAS components under NARP will be implemented
within the framework of MAAIF's DSIP with the Agricultural Sector Working Group providing
overall development policy direction and ensuring complementary and mutually reinforcing
programs. M&E of agricultural R&D programs, including projects financed through CRGs, will
be mainstreamed in the reinforced NARO and MAAIF M&E systems.
6. Concerning NARP, at all levels (NARO, NARIs, and ZARDIs) clients and stakeholders
are in command to ensure that resources are allocated according to the agreed priorities and that
effective and efficient implementation is focused on enhanced productivity and incomes. The
multi-stakeholder NARO Council is mandated to coordinate the Uganda NARS, which
comprises all public and private ARSPs. It is the governing body for most publicly funded
agricultural research and provides policy guidance, quality standards, and oversight of PARI
research management and implementation, including priority setting and resource allocation. The
Council is also in charge of implementing NARP. NARO delegates governance of NARIs and
ZARDIs to stakeholder Management Committees (MCs) responsible for priority setting, research
program management, and implementation monitoring at NARIs and ZARDIs. Implementation
of Council decisions is delegated to the NARO Secretariat, which works in consultation with the
User, Science, and Finance and Administration Committees. NARP management will be
assigned to the NARO Secretariat through a subsidiary agreement. The NARO Secretariat will
implement NARP through the PARIs in partnership with those universities, private sector
entities, and civil society organizations that have been certified by the NARO Council (Figure 6-
A).
87
Figure 6-A: Structure of the NARO Apex
88
7. Management, Coordination, and Implementation. As with its predecessor project ARTP
II, NARP will be fully integrated with the GoU's regular programs and procedures for
agricultural R&D. Thus there are no special implementation arrangements except for the regular
joint supervision by the GoU and DPs. The NARO Secretariat, led by the Director General and
overseen by the NARO Council, provides for the coordination and quality assurance of both the
ATAAS as well as the EAAPP-funded research and for the disbursement and appropriation of
funds released by the Treasury through MAAIF. The NARO functions are executed through the
Directorate of Research Planning and Coordination and the Directorate of Quality Assurance,
both supported by the NARO Secretariat's Finance, Audit, Human Resource, and Administration
Units. The semi-autonomous PARIs, overseen by their respective MCs, are responsible for the
efficient disbursement of the allocated funds and for the generation and dissemination of
technologies. The NARIs and ZARDIs collaborate on the basis of an inter-dependent partnership
to achieve impact and the integration of identified demands and opportunities, and to support
collaborative adaptive research and dissemination. Mainly facilitated through support from
CRGs, other NARS research partners will work in tandem with the PARIs to enhance the
provision of research services. The universities will be particularly important in staff training and
in basic research. Private sector actors will provide pathways for technology commercialization
while NGOs, NAADS and farmer organizations will play crucial roles in demand articulation,
priority setting, and dissemination of technologies.
8. Under NARP, all ARSPs will operate in partnership mode based on the principle of
pluralism in research service provision through inter-institutional collaborative arrangements that
allow each ARSP, in view of the agreed priorities, to take the lead in implementing activities for
which it has a competitive advantage. This modus operandi is designed to promote specialized
competence development and promote the contracting of professional competence from
universities, the private sector, and civil societies, thereby reducing core investments in human
resource and infrastructure development in the public sector. Through private sector
participation, the program will introduce entrepreneurship into the public sector and science into
the private sector. NARO will contract competencies from outside the public sector through: (i)
strategic core funding modalities; (ii) CRGs; and (iii) NARO-NAADS collaboration.
9. NARO and NAADS accept the ZARDIs as the nodal mechanism for implementing their
partnership. NAADS will establish Zonal NAADS Offices at the ZARDIs to link closely with
DNC offices within the respective ZARDI constituencies. Through the ZARDIs, collaborative
activities will be implemented in accordance with the joint results framework to link outcomes
and impacts of the two organizations to the DSIP development objectives and to track progress.
A shared NARO-NAADS budget will be provided under ATAAS to finance joint projects on
adaptive research and technology dissemination.
10. Operating the CRSs. Lessons from operating the GGSs at national and zonal levels under
ARTP II revealed significant duplication in the tasks of the committees involved and excessive
costs. In consultation with the NARO Council and various stakeholders and in line with the
principle of separating research funding and implementation, the NARO Secretariat revised the
CG guidelines and procedures and especially the institutional arrangements for managing the
grants at the zonal level. A single set of guidelines was designed for the national and zonal
CRGs. Priority setting, calls for proposals, and the allocation of funds to winning proposals in
the zones will be a function of the MCs facilitated by the Zonal Fund Secretariats. The MCs will
establish a subcommittee for screening and evaluating R&D proposals. The subcommittee will
89
include two co-opted independent scientists; where needed, they will call on peer reviewers. To
maintain the separation between funding and implementation, the Zonal Fund Secretariats will
handle disbursements and financial reporting52. In projects funded by CRGs, co-financing will be
encouraged, starting with valuing the in-kind contribution of various partners like transport,
facilities, and equipment. In the past, such grant schemes have been supported predominantly by
donor funds, specifically by DfID, IDA, and Danida. To enhance sustainability and continuity of
the grant scheme, the NARO Council is engaged in a dialogue with the Treasury, through
MAAIF, to increase GoU funding to research and especially the CRGs.
Implementation of ATAAS through NAADS
11. The Role and Activities of MAAIF Headquarters. MAAIF is the ministry responsible for
the agricultural sector. It will have overall national responsibility for the NAADS program as
provided for in the NAADS Act and will remain accountable to the Minister for MAAIF on
matters related to the NAADS Program. It will be responsible for promotion, advocacy, strategic
guidance, and support of the program through formulation of agricultural sector policy. It will be
responsible for appointing the NAADS Board, on which a representative of MAAIF is a
member. In addition, MAAIF will be represented at any of the NAADS committees that are
relevant for MAAIF Headquarters to fulfill its mandate. The NAADS will continue to be fully
represented at the Top Management Meeting of MAAIF and on other technical committees that
deliberate on agriculture sector policies and strategies. Mechanisms will be designed and
implemented to enable SMSs at the NAADS Secretariat to work formally and closely with their
counterparts at the ministry in supporting, backstopping, and monitoring program
implementation at the district level.
12. The Role and Activities of the Board. The NAADS Board will retain the functions that it
performed in Phase I in accordance with the NAADS Act. Among other activities, it will provide
guidance on policy direction and strategies. As provided for in the NAADS Act, it will facilitate,
supervise, and support the NAADS Executive (i.e. NAADS Secretariat) in implementing the
program. The NAADS Board in undertaking its responsibility it will report the Minister,
MAAIF. It will establish technical subcommittees to assist it in discharging its functions. The
members of the technical subcommittees will be appointed from among the board members, but
the option to co-opt technical staff from GoU ministries and agencies is open to the board.
13. The Role and Activities of the NAADS Secretariat. The NAADS Executive undertakes
program implementation and management. The Secretariat is responsible for NAADS
management and closely coordinates the program with the ministries responsible for finance and
LG. The NAADS Secretariat has responsibility for the planning, direction and guidance, support,
and management of the program. The NAADS Secretariat will require enhanced systems for
human, physical, and information resource management to undertake its role. Staff performance
assessments and overall organizational performance assessments will be enhanced and
undertaken annually. The MIS will be utilized to provide more effective and timely information
for management decision making as well as to enable NAADS to interface more effectively with
52
At the national level, CRG proposals will continue to be screened and evaluated by the NARO Secretariat
Technical Committee with the help of peer reviewers. The Science Committee and NARO Council will approve
projects.
90
the management systems of implementing partners. See the component descriptions (Annex 4)
for the institutional investments planned to enhance the operations of the NAADS Secretariat.
14. The Role and Activities of the LGs. The District and Subcounty LGs play a major role in
managing the implementation of the NAADS program. The NAADS implementation structures
will be fully integrated in the existing LG structures. The NAADS coordinators at district and
subcounty levels are LG employees but will be recruited and remunerated under NAADS
performance-based contracts. Their activities will be fully integrated and mainstreamed within
the District Production Departments and embedded in their management processes. The specific
roles that LGs play include oversight, coordination, technical backstopping, financial and
procurement management, and monitoring the NAADS program within their jurisdictions. The
LG also facilitates planning, budgeting, and integration of NAADS in annual work plans. It will
be responsible for preparing statutory accounts and financial reports and submitting them to the
appropriate authorities, as described in the NAADS participation MoU. The CAO is the
Accounting Officer for the district. The DNC53 will be answerable to the CAO for through DPO
for all purposes. The district structure will extend to the Subcounties, where farmers will be in
charge of actual implementation. The Subcounty Chief will be the accounting officer at this level
on a delegated basis. The SNC54 will be responsible for coordinating the work of the farmer fora,
which will plan and implement program activities.
15. The Role and Activities of the Farmer Fora. The general functions and roles of the farmer
fora at the national, district, and subcounty levels are spelt out in the NAADS Act. The capacities
and roles to be carried out by the farmer fora will be enhanced under ATAAS. The specific roles
that the farmer fora play in managing the implementation of NAADS are detailed in the
descriptions of the components and are central to NAADS Program management (Annex 4).
They are also the institutions that will ensure long-term sustainability of the demand-driven
delivery of agricultural services and will continue to be at the center of NAADS institutional
capacity development efforts. Resources have been allocated to redesign and improve
governance and management systems to ensure that farmers are in control of program resources.
The intention is to ensure that the farmer fora and farmer groups are sufficiently robust to
develop advisory service plans and business plans that can attract support from public and
private sources.
16. NAADS will work to develop mechanisms for ensuring farmer institutions empowered to
receive and manage resources directly. This process, to be based on an action-research mode,
will be initiated at the beginning of ATAAS by channeling funds directly to farmer institutions.
This mechanism will be piloted with farmer groups and farmer fora that over time have met
management criteria that will be set by NAADS. Funds will be earmarked for the activities of
these groups and fora by the NAADS Secretariat.
17. The Role and Activities of Farmer Groups. Services supported by NAADS will be
directed at farmer groups, implying that individual farmers will access services and benefit from
them by belonging to groups. Farmer groups will therefore be responsible for planning,
tendering, and contracting as well as supervising, monitoring, and evaluating activities. The
53
DNC is a technical officer recruited by the district on performance-based contract to be in charge of NAADS
activities in the district, according to the NAADS Act (2001).
54
SNC is a technical officer recruited by the Local Government to on performance-based contract be in charge of
NAADS activities in the subcounty, according to the NAADS Act (2001).
91
farmer groups are at the frontline of NAADS management, and their effectiveness has the
biggest effect on the quality of delivery of the NAADS primary outputs and impact. Resources
will therefore be provided to build their management and governance capacities.
18. The Roles and Activities of Supporting Ministries:
For both NAADS and NARO, the Ministry of Finance Planning and Economic
Development (MoFPED) will be responsible for all its traditional functions, including
acting as the contracting party to the participating agreements on behalf of the GoU;
providing overall oversight to program financing, planning, budgeting, monitoring, and
evaluation; and performing financial audits through the Auditor General.
The Ministry of Local Government (MoLG) will ensure that NAADS complies with the
Local Government Act, under which the NAADS activities at the district and subcounty
levels will be managed. The Decentralization Secretariat of MoLG shall provide the
interface between NAADS and LGDP and all other initiatives to build LG capacity in the
districts, including the incorporation of NAADS-related issues in its regular annual LG
assessments. Other relevant ministries will play ad hoc roles in implementing NAADS.
19. The Role and Activities of NAADS Public and Private Partners. The active participation
of various stakeholders at all levels will foster smooth implementation. In addition to the strong
participatory principles that are built into NAADS, the NAADS Secretariat, participating
districts, and subcounties will enter into or strengthen partnerships with government agencies
and private service providers to access the wide range of services that farmers and other actors in
the value chain require to transform advice into tangible outputs. These arrangements will be
formalized through MoUs, if this has not already been done.
Improvements to NAADS institutional arrangements reflecting lessons from Phase I
20. Transparency and Accountability. NAADS governance, financial management and
procurement systems and processes have been enhanced to improve their performance along the
following lines:
The GAC actions will be mainstreamed in NAADS implementation processes and
guidelines at all levels (Annex 9).
Collaboration with government agencies responsible for effective governance, such as the
Inspector General of Government (IGG), is being improved.
A system of rewards and sanctions for implementing institutions and officials will be
mainstreamed at all levels.
Publicity and transparency will be enhanced in allocating and using resources.
Independent external accountability of NAADS processes has been introduced.
The capacity of farmers and communities to monitor NAADS processes has been
enhanced.
Mechanisms to publicly disseminate financial information to all key stakeholders have
been enhanced through public media, public notice boards, Parliament pigeon holes, the
NAADS website, bulk text messaging, and the NAADS database.
21. Restructuring of management. In line with the NAADS Act, management structures and
processes at all levels have been reviewed and enhanced. Guided by the NAADS Board and
independent consultants, management systems and structures will be reinforced in light of the
92
lessons and challenges from Phase I. Some of these efforts are described in the following
paragraphs.
22. At the national level, the Secretariat staff will be augmented with an internal audit
department with a senior post for internal auditors. This department is critical for NAADS to
improve its special investigations, its forensic auditing, and its links to government agencies
responsible for fighting corruption. Staffing, specialized training, and staff development will
increase within other key departments (for example, SMSs will be integrated within NAADS).
NAADS will recruit or retain communications and public relations expertise to improve public
awareness of its activities. Eight zonal offices will be created and located at ZARDIs to improve
overall coordination and supervision of program implementation. These offices will provide
technical support to districts within the same region. One NAADS Zonal Coordinator and one
program officer will be placed at each ZARDI. One will be responsible for the regional
coordination and backstopping of district activities, while the other will provide the functional
link between NAADS and NARO at the ZARDI. A functional analysis and human resource
mapping quantified staffing requirements. Positions have been restructured or rationalized and
staff recruited to fill to vacant positions. Staff development programs have been conducted.
Figure 6-B depicts the structure of NAADS at the national level (subject to approval of the
Minister for MAAIF):
Figure 6-B: Structure of the NAADS at the national level
PAD Page 102
NAADS Secretariat (Phase 2)
75 Staff Members
Board Sub
Board of Directors (15) Committees (Fin &
Audit Sub Committee
Admin; Prog/Tech.
Executive Director (1)
Executive/Personal
Assistant (1)
Director, Planning
Director, Technical
Monitoring & Director, Finance&
Services (1)
Evaluation (1) Administration (1)
Manager, Manager, Manager,
Manager, ICT/MIS Manager, Manager, Finance
Internal Audit Monitoring & Agribusiness Dev't Manager, Human
(1) (1) Agricultural Resource & Admin. (1) (1) Manager,
Evaluation (1) (1)
Advisory Services Procurement (1)
(1)
Internal Auditors
(3)
Technology Enterprise Human Procurement Officers
Corporate Planning Officers Development Resource Officer Treasury
Promotion Officer (National Support) (2)
Comm. & PR ICT Support
Officer (1)
(2) (2) Officer (1) (1) Accountant (Cash
Officer (1)
Forensic Audit & Mgmt) (1)
Investigations Officer
(1)
Product Financial
Procurement Officers
Advisory Services (LGs Support) (2)
Database Support Development Accountant
M&E Officer (1) Officers (2) Administration
Officer (1) Officer (1) (Statutory
Compliance & Risk - Officer (1)
Officer (1) Reporting) (1)
Asst. ICorporate Asst
Comm. & PR Officer Procurement
(1)
Mgmt Accountant
(Budget Support) Officer (1)
FID/SD Officer (1) (1)
Support Staff
- Exec. Assts 3;
Regional NAADS Coordinators (7) - Front Office Asst/Receptionist; Regional Asst. Treasury
Tech. Innovation Support Officer (7) - Drivers ­ 10; Accountants
- Office Attendants - 2
Accountant
NAADS Interns (Ave. of 5 (District Support) (Cashier) (1)
per year) (3)
District Internal District Designated District District Human District Procurement
Auditors NAADS Coordinators NAADS Accountant Resource Officer Unit
23. At the LG level, the main change in organizational structure involves hiring eligible
SNCs and full-time AASPs under performance-based contracts. Figure 6-C illustrates links
between NAADS, the districts, and subcounties.
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Figure 6-C: Links between NAADS, the districts, and subcounties
NAADS Phase II MoLG MAAIF MFPED
Local Government Structure
District Executive Council NAADS Board
(LCV) (Directors)
National Farmers Fora
Chief Administrative Office
NAADS Secretariat
District Farmers Fora
District Planning District Finance
Unit Department District Production
Department District Internal
Audit
Designated District
NAADS Accountant
District District NAADS District Commercial District Internal Auditors
Subject Matter Specialists
DVO; DAO; DFO; DE; AE
Coordinator Office
Sub County
Sub County Farmers For a
Executive Council
Executives Senior Assistant
(LC III)
Secretary/Sub
County Chief
Subject Matter Sub County
Specialists NAADS Coordinator
Agricultural Advisory
Services Providers
NAADS
Farmer Groups
24. Putting in place optimal human resources capacities. NAADS will establish an efficient,
effective system and processes to manage human, physical and information resources. ATAAS
will focus on developing and implementing a comprehensive, effective system to assess
organizational and staff performance every year. The assessments are intended not only to
reward or sanction staff but to foster an internal management dialogue and staff development
effort to improve overall performance. Resource management interventions will be directed at
improving the efficiency of resource use and ensuring zero tolerance for corruption.
25. Putting an efficient MIS into place. NAADS will pilot a web-based MIS to enhance the
functionality and versatility of management interactions. The MIS will ensure timely delivery of
information for decision making and reporting at all levels. Separate but sufficiently interrelated
systems will be established for financial management (using suitable accounting software),
subproject tracking, and output-based subproject management. Staff will be trained to use the
MIS, which will be integral to the system developed for M&E (Annex 3).
26. Implementing a communications, advocacy, and public relations program. NAADS's
expanding mandate and national profile under ATAAS require a more proactive approach to
informing the public about its activities and achievements and greater attention to its role as a
public advocate in its areas of expertise. NAADS will review its communications and public
relations requirements, revise its strategy accordingly, and energetically implement a new
communications program. The NAADS Secretariat will outsource public relations expertise
when internal expertise is not sufficient.
27. Reflection and learning across all areas of work. ATAAS will develop a reflection and
learning framework to elicit lessons from the activities it supports systematically with a view to
improving NAADS (and NARO) performance. The planning, monitoring, and evaluation
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framework has been improved and will be better integrated into the management processes of
both organizations.
NAADS/NARO joint implementation activities
28. The NARO/NAADS Partnership Framework clarifies which activities will be done
jointly and the respective roles and responsibilities of each institution. Under ATAAS, the
following joint activities will be carried out:
Planning and priority setting, including processes to identify and respond to farmers'
technology needs at the subcounty, district, ZARDI, and national levels. A capacity
building program will be developed for service providers and SMSs who will be involved
in identifying technology needs and in the subcounty enterprise prioritization process.
Joint planning and implementation of adaptive research activities will strengthen
linkages between the ZARDIs and DARSTs. Where appropriate, this work will include
the promotion of farmer-based multiplication of foundation and quality-declared
technologies for which there is no commercial market.
Institutional capacity strengthening, including a jointly developed program to build the
capacity of District SMSs to fulfill their quality assurance and standard setting function.
A program will also be developed to build the capacity of AASPs, which will include
setting standards, training, AASP certification, the development of regular joint training
programs, and the development of guidelines for the evaluation of service providers on
performance-based contracts.
Implementation of a joint ATAAS Results Framework, including the development of a
joint M&E system and an appropriate mechanism for coordinating activities between the
two institutions. The M&E plan will include the implementation of detailed household
baseline, mid-term, and end-of-project surveys and impact evaluation by an independent
firm or consultants, monitoring of indicators, and joint reporting.
29. Implementation of a joint ICT strategy identified by both institutions as critical for
attaining ATAAS objectives. The ICT platform that will be developed will improve the quality
and timeliness of information required for decision making, increase outreach and improve
networking among staff and external stakeholders such as SMSs, service providers, and farmers.
This joint effort will increase the amount of technical knowledge as well as program-specific
knowledge available to the public and should enhance the likelihood that both organizations will
fulfill their core missions (see Working Paper 6 in Annex 14).
30. Partnership Implementation. NARO and NAADS will be jointly responsible for the
implementation of this component. At national level, overall implementation responsibility
would be with a senior staff person in each Organization, backed up by joint NARO-NAADS
and other key stakeholder Committees for each specific activity carried out under the component.
Oversight would be with the existing NAROC Users Committee and the NAADS Board
Program Committee. At zonal level, responsibility for implementation of Partnership activities
would be with the ZARDI Director and the NAADS Zonal Coordinator, with the latter having
lead responsibility. At that level, oversight would be with the ZARDI MC.
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Annex 7: Financial Management and Disbursement Arrangements
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
A. Introduction
1. Financial management arrangements for the proposed ATAAS (to be implemented by
NARO and NAADS, established by Acts of Parliament--the NAADS Act (2001) and NAR Act
(2005), respectively--were assessed in accordance with the Financial Management (FM)
Practices Manual issued by the Financial Management Sector Board, November 3, 2005.
2. The objective of the assessment was to determine whether the participating institutions
have adequate financial management systems and related capacity in place which satisfies the
World Bank's Operation Policy/Bank Procedure 10.02 with respect to financial management.
Under the policy, borrowers (recipients) and project implementation entities are supposed to
have and maintain adequate financial management systems, which include budgeting,
accounting, internal controls, fund flow, financial reporting, and auditing arrangements, to ensure
that they can readily provide accurate and timely information regarding project resources and
expenditures. These arrangements are deemed acceptable if they: (i) are capable of correctly and
completely recording all financial transactions and balances relating to the project resources; (ii)
can facilitate the preparation of regular, timely, and reliable financial statements; (iii) safeguard
the project's assets; and (iv) are subject to auditing arrangements acceptable to IDA. The
assessment also included the identification of key perceived financial management risks that may
affect program implementation and the development of measures to mitigate those risks.
B. Summary
3. Results from the assessment indicate that the overall financial management risk rating is
high, which is expected to reduce to substantial on implementation of the mitigating measures.
Much as the residual risk rating is substantial strong safeguards are being put in place to reduce
the rating to a lower level. However it should be noted that these will take time thereby having
residual risk currently substantial. We will carry out close monitoring and intensive supervision
so to reduce the risk levels further. This finding satisfies the Bank's minimum requirements
under OP/BP10.02. Therefore the financial management arrangements are adequate to meet the
World Bank's requirements under OP/BP10.02 and are adequate to provide, with reasonable
assurance, accurate and timely information on the status of the project required by the World
Bank. Both institutions have experience in implementing programs funded by the World Bank
(specifically, agricultural research and training for NARO and national agricultural advisory
services for NAADS). During implementation of the closed World Bank financed project,
NARO received an unqualified (clean) opinion on its financial statements, although some
internal control weaknesses were noted by the auditors. NARO has continuously addressed the
various issues raised by the auditors so to improve its internal control systems. Audit opinions
for NAADS, on the other hand, have been qualified for the last two years, and some ineligible
expenditures identified which the Government committed to refund in accordance with the DCA.
There has also been late submission of quarterly IFRs. The underlying issues have been
identified issues and will be addressed during the implementation of this project. A rigorous
supervision plan will be implemented to reduce the risks to acceptable levels.
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C. Country issues
4. The recent Public Expenditure and Financial Accountability Report of November 2008,
issued in June 2009, and Country Financial Accountability Assessments, carried out in 2004 and
2008, show that the GoU has made substantial progress in improving its public financial
management systems since the Country Financial Accountability Assessment undertaken in
2001. The fiduciary risks associated with poor budget formulation and budget preparation
processes have been reduced. In terms of appropriate legislation and regulatory frameworks,
significant progress has been made to ensure that the risk associated with the lack of clear rules
and regulations has been reduced. More useful pieces of information are provided in the Reports
and Opinions of the Auditor General to Parliament on the status of Public Accounts of the
Republic of Uganda, which are up to date. Risks remain, however, in terms of: (i) the quality and
timeliness of in-year budget reports, since budget reports include only information on budget
releases and not actual expenditures; (ii) the stock and monitoring of expenditure payment
arrears; (iii) the effectiveness of internal auditing; (iv) the oversight of aggregate fiscal risk from
other public sector entities and non-compliance with procurements rules; (v) the effectiveness of
measures for taxpayer registration and tax assessment; (vi) the legislative scrutiny of external
audit reports; (vii) the effectiveness of payroll controls; and (viii) the effectiveness in collecting
tax payments. The GoU has prepared a Financial Management Accountability Program
(FINMAP) to address the weaknesses in its public FM system.
D. Risk assessment and mitigation
5. The objectives of the project's financial management system are to:
(i) Ensure that funds are used only for their intended purposes in an efficient and
economical way.
(ii) Ensure that funds are properly managed and flow smoothly, adequately, regularly,
and predictably to meet the objectives of the project.
(iii) Enable the preparation of accurate and timely financial reports.
(iv) Enable project management to monitor the efficient implementation of the project.
(v) Safeguard the project assets and resources.
6. Furthermore, the following are necessary features of a strong financial management
system:
(i) An adequate number and mix of skilled and experienced staff.
(ii) The internal control system should ensure the conduct of an orderly and efficient
payment and procurement process and proper recording and safeguarding of assets
and resources.
(iii) The accounting system should support the project's requests for funding and meet
its reporting obligations to fund providers, including the GoU, IDA, other DPs, and
local communities.
(iv) The system should be capable of providing financial data to measure performance
when linked to the output of the project.
(v) An independent, qualified auditor should be appointed to review the project's
financial statements and internal controls.
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7. Table 7-A identifies the key risks that the project management may face in achieving
these objectives and provides a basis for determining how management should address these
risks.
Table 7-A: Key risks and mitigating measures
Risk Risk Risk Mitigating Measures Risk Rating Condition of
Rating Incorporated into Project after Negotiations,
Design Mitigation Effectiveness
(Y/N)
Inherent Risk
Country Level-The 2008 Public S A government-led PFM Reform Program is M
Expenditure and Financial addressing issues of financial management,
Accountability Report identified a procurement, and related enforcement.
number of risks in the areas of Public service (Payroll and Pension)
accounting capacity, budget reforms are underway. There is also
classification, and payroll rules. increased scrutiny by Parliament through
Challenges in enforcement of the Public Accounts Committee (PAC).
procurement and payroll rules and PAC will also handle district reports.
procedures still exist.
Entity Level- S M
NARO: Implementing entities NARO: The finance and accounts
could delay submitting department at NARO will be responsible for
accountabilities and reports to following up with all implementing
NARO. institutions and departments in MAAIF to
ensure prompt submission of accountability
and reporting. Strict reporting deadlines to
be instituted and followed. Review and
follow-up by internal audit.
NAADS: Delayed transfer of funds NAADS: LG assessments, to ascertain the
to sub counties. LGs (subcounties readiness of districts to receive funds, to be
and districts) may fail to account carried out before funds are advanced. The
for funds advanced. Delayed finance and accounts department at NAADS
submission of reports to NAADS. will be responsible for following up with all
Delayed submission of reports to local governments. Regional Accountants to
IDA. be recruited to follow up on accountability
and reporting. An Accountant at district
level to be designated for NAADS.
Implementation of computerized accounting
system at local governments. Reporting
timelines at each level are to be instituted.
Signing of MoUs with LGs.
Project Level- H S
NARO: The risk will be mitigated by
The project has a multiplicity of
adherence to implementation arrangements
actors, which makes it complex,
as well as signing of an MoU between
given the fact that it is
NARO and each implementing institution or
implemented by the private sector
agency. The MoU will spell out among
and autonomous organizations and
others the responsibilities of each institution
may become difficult to monitor.
and the duties and responsibilities of staff
assigned to the project.
98
Risk Risk Risk Mitigating Measures Risk Rating Condition of
Rating Incorporated into Project after Negotiations,
Design Mitigation Effectiveness
(Y/N)
Community oversight of the program to be
encouraged. Local government leadership to
be strengthened. Sensitization of all
stakeholders will be carried out so as to raise
awareness of what is expected of the project.
Overall Inherent Risk H S
Control Risk
Budgeting: M L
Project budget plans to be prepared in
Some project costs may end up
realistic and sufficient detail and used as a
being underestimated due to
management tool. Close monitoring of
frequent price changes.
variances between budgeted and actual
Budget overruns, failure by local expenditure. Budget process to involve all
governments to co-fund the departments, units, sections, and LGs.
program. Failure by implementing Budget revision and approval process to be
entities to monitor the budgets. set and adhered to.
Accounting: M L
NARO is adequately staffed with qualified
and experienced accounting staff and uses a
computerized accounting system (Solomon)
Failure to maintain proper books of that will be used to maintain appropriate
accounts. Failure by the districts books.
and sub counties to account for the NAADS- The organizational structure of the
funds advanced. Inadequate finance department is to be restructured to
staffing in the finance and accommodate the current structure of the
accounting departments at the program. More staff, including regional
secretariats as well as the local accountants, to be engaged at the secretariat.
governments. Ineligible Regional Accountants to follow up
expenditures and failure to account accountabilities, reports and build capacity
for funds advanced. at the local governments. The FM manual
will be revised. An FM Handbook to be
prepared and used by the subcounties as
well as at the community level. A formal
collaboration framework will be instituted
between NAADS and government agencies
responsible for corruption, implementing
reward and sanction schemes. Proper
record-keeping at the LGs.
Internal Control: H S Yes:
NARO has qualified and experienced
NARO: Inability to follow up Condition of
internal auditors who will review the
reported internal control effectiveness-
internal control environment at all
weaknesses. Revision of
implementation levels. The general internal
FM manuals,
control environment will be monitored by
as part of
individual heads of departments.
NAADS: Inability to follow up PIM.
reported internal control NAADS: Strengthening the internal audit
function to include a Board audit committee,
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Risk Risk Risk Mitigating Measures Risk Rating Condition of
Rating Incorporated into Project after Negotiations,
Design Mitigation Effectiveness
(Y/N)
weaknesses. Failure to perform elevation of internal audit to department,
internal audit function at all levels. recruiting additional audit staff, as well as
Failure of the current linking to LG internal audit units and
organizational structure to support internal audit under MoFPED. FM Manual
the expanded operations of the revised and FM Handbook prepared and
program. Failure by the audit used by subcounties and communities.
committee (AC) to carry out its Effective use of limited Audits that will be
oversight function conducted by an independent professional
firm. Limited audit to be closely linked to
internal audit. Capacity building to be done
at LGs. Following up of audit issues will be
on the score card of the internal audit
department. Implementation of audit
recommendation to be on the score card of
the head of finance & accounts.
Fund Flow: M L
Delayed release of funds to the Timely submission of financial reports from
implementing institutions and LGs the implementing entities to trigger the
(districts and subcounties). Misuse release of funds. Close monitoring of release
of funds at the community level. of funds by the secretariats, responsible
ministries, and MoFPED. The MoUs that
will be signed to emphasize reporting
timelines for LGs. Automated data capture
at the subcounty level Sanctions to apply to
districts that do not release funds in a timely
manner. Funds are to be released on the
basis of reports received. Strict control
measures at the community level. Financial
management handbook to be provided.
Financial Reporting: H S Yes:
Participating institutions must produce Condition of
Financial Information may be late
formats of unaudited IFRs to be used for negotiation-
and unreliable for purposes of
ATAAS. These formats have been agreed IFR formats
preparation of required reports.
with IDA during negotiations. NAADS to
Delayed reports.
automate data capture at the subcounty and
district levels. Realistic reporting timelines
to be instituted and adhered to for each
level. Training of finance staff at all levels
(secretariat, districts, subcounties, and
communities).
Auditing: S M
Late submission of reports, non- Early engagement of the auditors and
implementation of audit commencement of the audit. Terms of
recommendations, and qualified reference to be developed and agreed with
audit reports. No follow-up on IDA early enough Terms of reference to
audit recommendations. include technical audit and detailed internal
control review and testing. Interim audits
will be introduced. Performance audits will
be carried out. Action plans for follow up of
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Risk Risk Risk Mitigating Measures Risk Rating Condition of
Rating Incorporated into Project after Negotiations,
Design Mitigation Effectiveness
(Y/N)
audit recommendations to be developed and
shared with IDA.
Overall Control Risk H S
Overall Risk Rating H S
Note: H = High; S = Substantial; M = Moderate; and L = Low.
8. The overall residual risk is expected to be Substantial upon successful implementation of
the mitigating measures in the risk assessment and mitigation table (7-A). These risks will be
reviewed and measured (assessed) during each supervision mission and will be recalibrated with
a view to revising the rating.
E. Strengths of the implementing entities
9. Project financial management is strengthened by the following salient features:
(i) Accounting personnel within NARO are adequately qualified and experienced.
(ii) Accounting policies and procedures are documented in NARO's FM Manual and
are adequate to be used for ATAAS.
(iii) Budgeting arrangements are adequate both at NARO and NAADS.
(iv) External auditing arrangements are adequate at NARO.
(v) Internal audit arrangements are adequate at NARO.
(vi) Funds flow arrangements are adequate at both entities.
(vii) The Solomon computerized accounting system is used by NARO and ATAAS
accounts will be prepared using this accounting software.
(viii) NARO has adequate financial reporting requirements. However, NARO developed
formats for IFRs that were agreed with IDA at negotiations.
10. Project financial management is weakened by the following:
(i) Inadequate staffing in the finance and accounting department at the NAADS
Secretariat as well as the local governments.
(ii) Use of manual accounting systems for NAADS by LGs, especially subcounties.
(iii) Weak internal audit function at NAADS.
(iv) Outdated FM manuals at NAADS.
(v) Weak budget monitoring systems for NAADS, especially at the local government
levels.
(vi) Inadequate audit arrangements at NAADS.
(vii) Lack of grievance redress and complaints handling system.
(viii) Weak ethics and integrity processes.
(ix) Weak community oversight.
(x) Little third-party monitoring of the project by Members of Parliament, Resident
District Commissioners, Local Council V Chairmen, Chief Administrative
Officers.
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11. The action plan in Table 7-B indicates the actions to be taken by NARO and NAADS to
strengthen their financial management systems, the due dates, and responsible entities.
Table 7-B: Action plan to strengthen financial management
Action Due Date Responsible Entity
1. Agree on the format of IFRs with IDA. Before negotiations NARO, NAADS,
and IDA
2 Agree on the external audit terms of reference with Before negotiations NARO, NAADS,
IDA. and IDA
3. FM Assessment of all local governments and ensure Before funds are disbursed to NAADS
that districts are ready to receive funds. the districts
4. Adoption of revised organizational structure of finance Before effectiveness NAADS
and audit.
5. Revision of the FM Manual and agreement with IDA Before effectiveness NAADS
(part of the PIM).
6. Preparation of FM handbook for the management of Before funds are disbursed to NAADS
the commercializing challenge fund. the commercializing
challenge fund
F. Budgeting arrangements
12. NARO: The NARO FM Manual Adequate clearly lays out adequate budgeting procedures
for the project for the staff responsible for budgeting. Given that NARO was granted Vote status,
the budgeting cycle is determined by the MoFPED. NARO will develop an internal budgeting
calendar and timelines on the basis of the cycle set by MoFPED and in keeping with the
provisions of NAR Act. The NARO cycle shall be set by the Secretariat and all PARIs will
ensure strict adherence. A Research Coordination Department is responsible for budgeting, and it
champions the process. All departments and research institutes (field-based) are involved in
budgeting, and finance has an input in terms of figures. The staff are qualified and experienced to
handle the budgetary arrangements adequately.
13. NAADS: Budgeting procedures are clearly laid out in the FM Manual for staff responsible
for budgeting at NAADS, and they are adequate for the project. Budgeting arrangements are in
accordance to the GoU budgeting and planning cycles. NAADS will develop an internal
budgeting calendar to be followed while developing budgets. All departments, districts, and
subcounties are involved in budgeting, and the finance department has an input in terms of
putting figures together. The staff are qualified and experienced to handle the budgetary
arrangements adequately.
G. Accounting arrangements
14. NARO: NARO will maintain books of accounts similar to those for other IDA-funded
projects. Books of accounts to be maintained specifically for ATAAS should be set up and
include a Cash Book, ledgers, journal vouchers, a fixed asset register, and a contracts register.
15. The books of accounts will be maintained on a computerized accounting system
(Solomon). A list of account codes (Chart of Accounts) for the project, in line with the GoU's
Chart of Accounts, is in place and is adequate to prepare accounts for ATAAS. The Chart of
102
Accounts allows project costs to be related directly to specific work activities and outputs of the
project.
16. NARO is adequately staffed with qualified and experienced accounting staff. The NARO
department of Finance is headed by the Chief Accountant, who reports to the Director General.
The Chief Accountant is supported by a Principal Finance Officer and Finance Officer. Below
the Finance Officer are Accounts Assistants. At the regional/institute level, the department is
either headed by a Senior Finance Officer or Finance Officer who reports to Chief Accountant.
17. Financial statements will be prepared on a modified cash receipts and payments basis.
The books of accounts shall be opened in accordance with requirements stipulated in the FM
Manual and as required in the project Financing Agreement.
18. NAADS: NAADS will continue to maintain books of accounts similar those for the IDA-
funded NAADS Phase I Project. The books of accounts will include a Cash Book, ledgers,
journal vouchers, fixed asset register, and a contracts register.
19. The books of accounts will be maintained on a computerized accounting system (IFMIS
at some local governments and through manual systems at the subcounty level). A list of account
codes (Chart of Accounts) for the project, in line with the GoU's Chart of Accounts, is in place
and adequate to prepare the accounts for ATAAS.
20. Much as NAADS finance staff are experienced they are few and inadequate to handle the
program. The department of finance is headed by the Finance and Administration Manager, who
reports to the Executive Director. The Finance and Administration Manager is supported by a
Senior Finance Officer and Finance Officer. Below the Finance Officer are the Accounts
Assistant and Assistant Finance Officer. Currently no NAADS accountants are based at the
regional or local government level. Local government accountants at the district and subcounty
levels are supposed to support the NAADS program, but they require close supervision and
monitoring at a higher level if the desired results are to be achieved. It is for this reason that
Regional Accountants are proposed to take care of this task.
21. Financial statements will be prepared on a modified cash receipts and payments basis.
The books of accounts shall be opened in accordance with requirements stipulated in the FM
Manual and as required in the project Financing Agreement.
22. For the case of the challenge fund, simplified books of accounts will have to be
maintained in accordance with the financial management handbook.
H. Internal control arrangements
23. NARO: The internal control systems are documented in the FM Manual. They are
adequate for use by this project to ensure that funds are utilized for the intended purposes.
24. The internal audit function is carried out by the Internal Audit Department of NARO,
which is headed by the Head of Internal Audit with one other staff member. Internal audit
reviews are also undertaken to ensure compliance with internal control guidelines. The Internal
Audit Department reports to the Finance Committee of the Council (Board). No Audit
Committee has oversight of the Council. It is advisable that an Audit Committee of the council
be put in place.
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25. NAADS: The internal control systems documented in the FM Manual are outdated. They
must be revised before the project becomes effective if they are to be used by this project to
ensure that project funds are utilized for the intended purposes.
26. The internal audit function is carried out by the Internal Audit Section of NAADS, which
is headed by the Senior Internal Auditor with two other staff. Internal audit reviews are also
undertaken to ensure that internal control guidelines are complied with. The Internal Audit
Section reports to the Executive Director. The Board Audit Committee, which will perform the
oversight function, has just been put in place. What remains is to strengthen and empower the
Internal Audit Section by elevating it to department level and adding a few more staff with the
right skills and experience in risk management, investigations, and fraud examination.
I. Fund flow arrangements
27. IDA and IFAD funds for ATAAS (NARO and NAADS) will be channeled through two
pooled accounts, the NARO pooled Designated Account and NAADS pooled Designated
Account. These will be foreign currency (US$) accounts held in the Bank of Uganda and will be
operated by the Director of Accounts in MoFPED. The GEF Grant will be channeled through a
separate NARO and NAADS pooled Designated Accounts. From these Designated Accounts, the
funds will flow into two Donor Basket Accounts (one for NARO and one for NAADS)
denominated in Uganda shillings at Bank of Uganda and will also be operated by the Director of
Accounts in MoFPED. The funds from other DPs, Danida and EU, will also flow into these
donor basket accounts (although these DPs will channel their funds separately, they are still part
of this PAD and therefore presented in dotted lines in the flow of funds diagram). The GoU
Treasury is responsible for maintaining the accounting records and ledgers and for preparing the
reports showing the transactions on the account. From there, the IDA, including other DPs,
funding will flow into the GoU Consolidated Fund account from where, in addition to GoU
contribution, they will be transferred to NARO and NAADS Secretariat operational accounts as
well as districts and subcounties in respect of NAADS. The NARO secretariat will then transfer
funds to implementing institutes and entities.
28. DPs will release their contributions to the NARO and NAADS Designated Accounts at
the beginning of every year or quarter or at intervals of their choice on the basis of six months
cash flow forecasts and subject to the submission of acceptable unaudited IFRs, including
financial statements, Output Monitoring Reports, and Procurement and Contract Management
Reports. NARO and NAADS will each prepare quarterly IFRs and submit rolling cash flow
forecasts every six months to provide a funds buffer for one quarter. The amount advanced to the
NARO and NAADS designated pooled accounts will be equal to the six-month forecast of
eligible expenditures less the balance remaining in designated pooled accounts at the end of the
quarter under review. The initial release will therefore cover six months of program
expenditures. The flow of funds to the districts and subcounties, in the case of NAADS, will
follow GoU mechanisms for intergovernmental transfers as closely as possible. NAADS
Program funding will be channeled from the GoU's Consolidated Fund account (including GoU
contributions) to districts as conditional grants. Districts and subcounties will be required to open
NAADS operational accounts. Funds will be transferred to the district Government Grants
Collection Account, from where they will be transferred to the district NAADS operational
accounts for activities implemented by districts and to the subcounty NAADS accounts for
activities implemented by the subcounties, farmer fora and farmer groups. Payments will be
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made from these accounts for NAADS eligible expenditures incurred by the districts and
subcounties and for services rendered to the farmer fora as well as transfers to the farmer group
bank accounts for the challenge fund. The challenge fund will follow the financial management
arrangements as detailed in the financial management handbook.
29. Funds transferred to local governments that remain unused at the end of a fiscal year will
be remitted to the Treasury in line with PAF guidelines. At the inception of program
implementation in a district, a quarterly release will be made based on cash flow requirements as
indicated in a six-month cash flow forecast by the districts and subcounties. The release to
districts will be on a quarterly basis following government practices while accountabilities to the
NAADS Secretariat will also be quarterly to enable the Secretariat prepare substantial IFRs. To
ensure transparency and accountability to end users and beneficiaries, districts will be required to
post mandatory public notices for funds received for NAADS activities in accordance with PAF
guidelines. In addition, farmer fora at all levels will be notified through letters from the district
(and subcounty) administration. Figure 7-A depicts the Common Funds Flow Mechanism
proposed for the ATAAS (NARO and NAADS) Project.
105
Figure 7-A: ATAAS fund flow
NAADS
IDA IFAD GEF
NAADS Designated pooled GEF Designated
account (US$) Account (US$)
Danida
NAADS Donor Basket
EU
Account at BoU (UShs)
GoU Consolidated Fund (UShs)
Account (inc. GoU funding) NAADS Secretariat
Subcounty
District Grants Collection Matching
Account (UShs) Grant
Farmer Group
District District NAADS Account Subcounty NAADS Account
Matching (UShs) Account
Grant
Farmers' Contribution
106
NARO
IDA IFAD GEF
NARO Designated pooled GEF Designated
account (US$) Account (US$)
EU
NARO Donor Basket Account
at BoU (UShs) Danida
GoU Consolidated Fund (UShs)
Account (inc. GoU funding)
NARO Secretariat
Implementing Institutes and
Entities
J. Disbursement arrangements
30. The NARO and NAADS will use the report-based disbursement. For this, they will
initially submit a cash flow forecast for six months in order to receive the initial deposit in their
respective Designated Accounts. Subsequently, withdrawal requests will be made at the end of
every calendar quarter. The withdrawal request will comprise a cash flow projection for the next
six months and an unaudited IFR accounting for funds utilized during the quarter that has just
ended. These withdrawal requests and IFRs need to be submitted to IDA within 45 days after the
107
end of each quarter. The report based method allows the project to have buffer funds for a three-
month period. It is important to note that cash flow projections must be supported by work plans
and Procurement Plans.
31. Continued use of the report-based method of disbursement will depend on: (i) whether
the project achieves and maintains a moderate or low risk rating based on assessments of its
financial management system during IDA supervision missions; (ii) ensuring that IFRs are
received within 45 days after the end of each quarter; and (iii) ensuring that audited financial
statements are submitted to IDA within six months after the end of each fiscal year.
32. The project can also use the direct payment method to draw funds from IDA (that is,
direct payments to a third party for works, goods, and services rendered to the project on
request). Payments may also be made to a commercial bank for expenditures against IDA special
commitments covering a commercial bank's Letter of Credit. Further details on disbursement
methods will be included in the Disbursement Letter sent by IDA, which will specify the
minimum application value for direct payments and special commitments.
33. If ineligible expenditures are found to have been made from the Designated Accounts,
NARO and NAADS will be obligated to refund the same. If the Designated Accounts remain
inactive for more than six months, NARO and NAADS may be requested to refund to IDA
amounts advanced to the Designated Account.
34. IDA will have the right, as reflected in the Financing Agreement, to suspend
disbursement of the funds if reporting requirements are not complied with.
K. Financial reporting arrangements
35. Unaudited IFRs will be produced by NARO and NAADS on a quarterly basis following
calendar year quarterly periods to enable IDA to monitor the progress of the project. The IFRs
will be sent to IDA within 45 days after the end of each quarter. NARO will develop and agree
with IDA formats for the IFRs to be used. The IFRs will contain:
(i) A statement of sources and uses of funds for the reported quarterly period and
cumulatively since project inception, reconciled with bank, cash, and other fund
balances at the end of the quarterly period.
(ii) A statement of uses of funds (expenditures) by project activity/component comparing
actual expenditure against the budget, with explanations for significant variances.
(iii) The Designated Account Activity Statement, reconciling the receipts into and
payments out of the Account.
(iv) Designated Account Expenditure for contracts subject to prior review
(v) Designated Account Expenditure for contracts Not subject to prior review
(vi) Supporting bank statements and reconciliations for the bank, cash, and other fund
balances at the end of the quarter.
(vii) Cash flow projections for the next six months.
36. For NAADS, Districts will be required to submit returns showing consolidated accounts
for the district itself and for subcounties within their areas of jurisdiction. Submission and
consolidation of returns will occur on a quarterly basis, with subcounties and districts submitting
quarterly returns to the next-highest level (that is, the subcounty will submit to the district and
108
the district to the NAADS Secretariat). These reports will be consolidated quarterly to show
results for the NAADS program.
37. For joint expenses, these would be accounted for by each implementing entity in
accordance with specific components and subcomponents implemented by each of them. These
expenses will be prorated for each implementing agency to avoid double accounting.
L. External audit arrangements
38. The external audit for NAADS and NARO will be carried out by the Auditor General or
any private audit firm appointed by the Auditor General and acceptable to IDA. The Fiscal Year
runs from July 1 to June 30. Audit Reports and Management Letters will be due at IDA on or
before the lapse of six months from the end of the fiscal year (December 31 of every year). The
audits must be performed in accordance with International Standards on Auditing.
39. NARO and NAADS will develop and agree with IDA the terms of reference for the
external audit before negotiations.
40. A review of NARO Audit Reports revealed that the most current audited accounts relate
to FY 2008/2009 and they were issued with an unqualified (clean) audit opinion. For NAADS,
the auditor expressed an Except For qualified opinion resulting from Matters brought to attention
as well as Limitation of Scope.
41. The Audit Reports that will be required to be submitted by NARO and NAADS and the
due dates for submission are shown in Table 7-C.
Table 7-C: Audit Reports and due dates
Audit Report Due Date
Program Specific Financial Statements, i.e. NARO Submitted within six months after the end of each
and NAADS annual audited financial statements fiscal/financial year.
and Management Letter
Conditionality
42. The negotiation and disbursement conditions to be included in the legal agreement are
listed in the action plan above (Table 7-B).
Financial Covenants
43. Financial covenants are the standard ones as stated in the Financing Agreement Schedule
2, Section II (B) on Financial Management, Financial Reports, and Audits and Section 4.09 of
the General Conditions.
Implementation Support Plan
44. Based on the outcome of the financial management risk assessment, an implementation
support plan is proposed (Table 7-D). The objective of the implementation support plan is to
ensure that the program maintains a satisfactory financial management system throughout the life
of the project.
109
Table 7-D: Implementation support plan
Activity Frequency
Desk reviews:
Interim Financial Reports review Quarterly
Audit Report review Annually
Review of other relevant information such as Continuous
internal audit reports.
On-site visits:
Review of overall operation of the FM system Annually (Implementation Support Mission)
Monitoring of actions taken on issues highlighted in Continuous
Audit Reports, auditors' Management Letters,
internal audits, and other reports
Transaction reviews (if needed) As needed
Capacity building:
FM training Before project start and thereafter annually
Technical assistance As the need arises
Supervision arrangements
45. A supervision mission will be conducted at least twice every year based on the current
risk assessment of the project. The mission's objectives will include ensuring that strong
financial management systems are maintained for the project throughout its life. A review will be
carried out regularly to ensure that expenditures incurred by the project remain eligible for
funding. The Implementation Status Report will include a financial management risk rating for
the project that will be arrived at by IDA after an appropriate review.
M. Conclusion of the assessment
The conclusion of the assessment is that the financial management residual risk rating of the
program is substantial. The financial management arrangements, with the proposed actions and
mitigating measures to strengthen the arrangements, do meet the IDA's minimum requirements
under OP/BP 10.02. The financial management arrangements are adequate to provide, with
reasonable assurance, accurate and timely information on the status of the project as required by
IDA.
110
Annex 8: Procurement Arrangements
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
Implementation arrangements
1. Procurement under the proposed project shall be implemented at the national, sub-
national­LG, and community levels as well as by private entities as shown in Table 8-A.
Table 8-A: Implementation of procurement
Level of Implementation Implementing Agencies Components
National NAADS Secretariat 2.1, 2.2, 2.3, 2.4, 2.5, 3.2, 5.2
NARO 1.1, 1.2, 2.1, 2.2, 2.3, 2.4, 2.5, 5.1
Sub-national Higher LGs/districts 3.2
Lower LGs/subcounties 2.1, 3.1, 3.2, 3.3
Community Community farmer groups 2.1, 3.3
Private sector, through PPPs Private sector 4.1, 4.2
2. Under NARO, procurement will be done both at the NARO Secretariat, the NARIs, and
the ZARDIs, which are semi-autonomous institutes under NARO.
3. Procurement will also be done by private sector partners selected under the
Commercializing Challenge Fund proposed under Component 4.
Applicable guidelines
4. Procurement for the proposed project will be carried out in accordance with the World
Bank's Guidelines: Procurement under IBRD Loans and IDA Credits (May 2004, revised
October 2006, and May 2010) and Guidelines: Selection and Employment of Consultants by
World Bank Borrowers (May 2004, revised October 2006, and May 2010), and the provisions
stipulated in the Legal Agreement.55 The various items under different expenditure categories are
described in general below.
Scope of procurement under the project
(i) Procurement of works: Works contracts to be procured under the project include (Table
8-B):
55
This is consistent with the national procurement law, which recognizes that if this law conflicts with obligations
arising from an international agreement with the Government then the provisions of the latter shall apply.
111
Table 8-B: Works contracts to be procured under the project
Agency Works
NARO Refurbishment of buildings in research institutes and construction
of additional buildings at existing institutes
Community Simple farm shade construction works
(ii) Procurement of goods: Goods procured under the project would include (Table 8-C):
Table 8-C: Goods to be procured under the project
Agency Goods
NARO Office equipment, motor vehicles, tractors, fertilizer, lab
equipments, chemicals and reagents, supply and installation of
information systems and fire safety systems.
NAADS Office equipment, motor vehicles, supply and installation of
information systems, agricultural technologies for promoting
strategic technologies
Subcounties Advisory services
Farmer groups / Agricultural inputs (such as planting materials, fertilizer, breeding
communities stock) and advisory services
Private sector partners Equipment, technology inputs
(iii) Selection of consultants: Consulting firms and Individual Consultants will be selected
for the following (Table 8-D):
Table 8-D: Activities for which consulting firms and Individual Consultants will be
selected
Agency Consultants
NARO Technical and market studies to facilitate zonal priority setting,
technical assistance for the National Seed Certification Service to
establish standards for seed certification, technical assistance to
seed companies, design and supervision of rehabilitation works,
design of information systems, chief information officer for
NARO and NAADS, ICT infrastructure needs assessment and
determination of MIS needs, audit of project accounts, peer
review of NARS, support in business plan development, training
in management for impact, international certification of PARIs
NAADS Business development service providers, audit of project
accounts, technical and performance audits, technical and market
studies to facilitate zonal priority setting, design of information
delivery technologies, training of local advisory services, capacity
development assessment of service providers, program baseline ,
mid-term and end of project impact assessment survey, design of
information systems, training of farmer fora, farming situation
analysis for selection of enterprises, quality assurance of farmer
institutional development service providers hired by districts,
quality assurance of providers of pre-intervention assessment of
112
Agency Consultants
the eligibility of existing groups in each sub-county
Higher local governments SNCs, DNCs, pre-intervention assessment of the eligibility of
existing groups in the districts, farmer institutional development
service providers
Subcounties Agricultural advisory services, Community Based Facilitators,
Agricultural Advisory Service Providers, Farmer Group promoter
change agents, Advisory services for business planning and
marketing
Farmer groups/communities Technology inputs
Universities, NGOs, and Private Sector Procurement: Under consultancy services, the
NAADS Secretariat and NARO shall hire universities and other research institutions to
conduct background studies (farming situation analysis) for selection of enterprises.
Private sector enterprises selected as grantees under the Challenge Fund shall also
procure consultants using commercial practices acceptable to IDA. The details of these
practices will be specified in the Procurement Manual. NGOs will be hired at the higher
and lower LG levels to support farmer institutional development.
(iv) Non-consulting services: Non-consulting services procured under the project will
include foundation technology multiplication and Quality Declared Seed production.
(v) Operating costs: The project will finance the operating costs of the various
implementing agencies that directly relate to project implementation. The project's
operating costs will include: fuel, stationery, equipment, vehicle maintenance,
communication expenses, bank charges, office consumables, furniture and fittings and
subsistence allowance for authorized travel, salaries of contract staff (excluding the
salaries of government civil servants) and renting office space.
(vi) Community procurement: Community procurement will be done at the Parish level
through the Parish Community Procurement Committees elected democratically by the
farmer groups in the parish. Procurement at this level will mainly involve technology
and other inputs that are available locally, in close proximity to the district. Procurement
at the lower local government levels shall also be done through Community Procurement
Committees elected from among representatives of the farmer fora. Procurement here
will include technology inputs that are not locally available in the district and advisory
services for farmers. Community procurement will also be done at the farmer group level
from the proceeds of the sub county challenge fund. These community procurement
committees shall be democratically elected from the respective beneficiary farmer
groups. The community procurement committees at all levels may be supported by the
district SMSs and AASPs as required. The applicable methods of procurement for all
community procurement shall be local bidding, shopping and direct contracting. The
details of the applicable procedures will be specified in the community and subcounty
procurement guidelines
113
(vii) Training: Training to be financed under the project will include MSc and PhD training
for agricultural research staff, financial management and procurement, and short-term
training in agricultural research processes and methodologies. The project will formulate
an annual training plan and budget, which will be submitted to IDA for its prior review
and approval. The annual training plan will, inter alia, identify: (i) the training envisaged;
(ii) the justification for the training (how it will lead to effective performance and
implementation of the project and/or sectors); (iii) the personnel to be trained; (iv) the
methods of selecting the institutions or individuals to conduct the training; (v) the
institutions that will conduct training, if already selected; (vi) the duration of the
proposed training; and (vii) the estimated cost of the training. Upon completion of
training, the trainee shall be required to prepare and submit a report on the training
received. Additionally the operational plan will specify how candidates eligible for
graduate training will be selected. These procedures shall ensure equal opportunity to all
eligible participants.
(viii) Research grants: Competitive research grants will be awarded under two categories: (a)
Zonal Competitive Agricultural Research and (b) National Competitive Agricultural
Research. Grantees shall be selected using the Guidelines for Implementation of the Zonal
Competitive Grant Scheme for Agricultural Research and the Guidelines for
Implementation of the National Competitive Grant Scheme for Agriculture (for the zonal
and national schemes, respectively) as approved by IDA. The guidelines have been
reviewed and found to be satisfactory for the selection of grantees using the Credit
proceeds. Revisions to these guidelines will require IDA's prior approval. The eligibility
and selection procedures for awarding grants are described in detail in the said guidelines.
Grants shall also be allocated in accordance with the NAR Act (2005) and the attendant
regulations. Further grants will be awarded competitively under the Commercializing
Challenge Fund under Component 4. The procedures for selecting beneficiaries will be
developed and will be subject to review and approval by IDA as a condition for
disbursement of funds for the challenge fund.
(ix) Joint Procurement: Some of the procurements under the project shall be done jointly
between NARO and NAADS. In such cases the two organizations shall set up joint teams
to conduct the procurement. The contract shall however be signed by only one of the two
agencies.
Use of national procurement system
5. All contracts procured at the national level and higher LG level following National
Competitive Bidding (NCB) and other lower procurement procedures (Shopping and Selective
Tender for smaller works contracts) may follow the national public procurement law (PPDA Act,
2003) and attendant regulations. These procedures have been reviewed by IDA and found to be
acceptable, except for the following provisions, which will not be applicable under this project:
(i) Negotiations with the best evaluated bidder. This practice is not allowed for the
procurement of goods and works under competition.
114
(ii) The merit point system for bid evaluation. This system shall not be applied for goods
and works contracts procured on the basis of competition: International Competitive
Bidding (ICB), NCB, or restricted tender.
(iii) Pre-qualifying bidders and then inviting only a few on a rotational basis. For
Shopping procedures, the Procuring and Disposal Entity will not be allowed to pre-
qualify suppliers on an annual basis and invite only a few on a rotational basis.
Where pre-qualification is conducted, all pre-qualified providers will be invited to
submit bids. Common supplies like stationery and consumables will be aggregated
and procured annually through framework contracts to enable implementing agencies
to place orders for urgently needed supplies at short notice, at a competitive price.
(iv) Application of Domestic Preference under NCB. Domestic Preference shall be
applied only under ICB.
(v) Micro Procurement. Direct contracting shall not be a default method for contracts
estimated to cost less than US$ 1,000.
6. Under the proposed project, procurement under ICB and selection of consultants shall
also (in addition to the World Bank guidelines) comply with the national approval system, except
where the two conflict. Specifically, the Contracts Committees shall perform their oversight
functions at each of the key procurement stages and contracts shall be subjected to the Solicitor
General's clearance where applicable.
7. Shopping shall follow the Request for Quotations (RFQ) procedures as defined in the
PPDA Act and attendant regulations with the exception of the rotation of bidders as indicated
above. These procedures have been reviewed by IDA and found to be satisfactory. In addition,
no negotiations shall take place with respect to a quotation submitted by the supplier or
contractor under Shopping.
Solicitation documents to be used
8. Goods and works: The World Bank's standard bidding documents will be used for
procurement under ICB and for procurement under NCB with appropriate modifications.
Alternatively, the standard tender documents for procurement of Supplies, Works, and Non-
Consultancy Services prepared and issued by the Public Procurement and Disposal Authority
(PPDA) may be used for NCB subject to the following modifications:
a. ONLY the Technical Compliance Selection methodology (award to the lowest
evaluated responsive bidder) as defined in the Act shall be adopted. The rest of the
methodologies shall not be used, even for NCB, for the procurement of goods,
works, and non-consulting services.
b. The following shall not be treated as eligibility requirements: (i) evidence of
payment of taxes; (ii) evidence of VAT registration and (iii) evidence of payment
of trading licenses. They may however be included as post qualification
requirements on which clarification can be sought during the evaluation.
115
9. Consulting services: The World Bank's Standard Request for Proposal document will be
used in the selection of consulting firms. The PPDA Standard Bidding Document for the
Procurement of Services shall not be used.
10. In accordance with paragraph 1.14(e) of the Procurement Guidelines, each bidding
document and contract shall provide the following: (i) the bidders, suppliers, contractors, and
subcontractors shall, on request, permit IDA to inspect the accounts and records relating to the
bid submission and performance of the contract, and shall have the said accounts and records
audited by auditors appointed by IDA and (ii) any deliberate and/or material violation of such
provision by any bidder, supplier, contractor or subcontractor may amount to an obstructive
practice provided for in paragraphs 1.14(a) and (v) of the procurement Guidelines.
11. At the community level, simplified solicitation documents provided for in the community
procurement guidelines shall be used.
Assessment of capacity to implement procurement
12. Procurement under the project will be conducted by several agencies, as indicated in
paragraph 1. A capacity assessment of these agencies was conducted between November 2009
and February 2010 and the findings, key risks, and the agreed mitigation measures are described
below.
13. NARO: Most of the procurement under NARO is done at the NARO Secretariat, with the
research institutes only conducting procurement for contracts below US$ 5,000. All contracts
above this amount are carried out by the NARO Secretariat on behalf of the institutes. The
NARO Secretariat has an established Procurement Unit with two procurement staff, but only one
has experience in procurement using World Bank procedures from the predecessor project.
NARO also has a Contracts Committee that adjudicates key procurement stages. For the civil
works, NARO has an estates manager who is a civil engineer but shall be supported in the
supervision of the works by a firm of consultants hired under the project. The key risks for
NARO are (i) insufficient staffing at the NARO Secretariat to handle procurement, leading to
delays in processing procurement; (ii) inadequate procurement planning at the Secretariat and
lack of procurement planning at the institutes; (iii) inadequate monitoring of procurement at the
institutes; (iv) lack of contracts committees and procurement staff at some institutes; (v)
insufficient participation by user departments in the procurement and management of contracts;
and (vi) insufficient experience in the procurement of information systems. The risk rating for
NARO is moderate. A summary of the risks and mitigation measures follows (Table 8-E):
Table 8-E: Procurement risks and mitigation measures for NARO
Risk Action Completion Date
1.
1. Hire procurement staff at the institutes September 2010
4 out of 15 research
without procurement staff.
institutes do not have
contracts committee and 6 2. Establish contracts committees at all
By project
do not have procurement institutes and, in the interim, the NARO
staff Secretariat (NAROSEC) to conduct all
116
Risk Action Completion Date
procurement for institutes without effectiveness
established contracts committees.
3. Hire consultant to continue to mentor and
train PDU staff as well as train the
institute staff and contracts committees in October 2010
procurement
2.
Inadequate monitoring of 1. Establish a system to ensure that the October 30, 2010
procurement at the institutes report on their procurements as
institutes, with institutes per the PPDA Act.
not reporting on
2. Hire consultants with qualifications
procurement conducted
acceptable to IDA to conduct audits of Biannually
procurement at the institutes at least once
in 2 years.
3.
Inadequate procurement 1. Train institutes in procurement planning. December 2010
planning at the Secretariat
2. Establish a system for ensuring that December 2010
and lack of procurement
institutes prepare and submit procurement
planning at the institutes
plans to NAROSEC and that these are
consolidated by NAROSEC.
4.
Insufficient participation 1. Assign the role of contract management June 30, 2010
by user departments, including processing payments to
especially PARI staff, in suppliers to the user departments with the
procurement and Procurement Unit only focusing on
management of contracts monitoring contract management.
2. Involve PARI procurement Staff and June 30, 2010
User departments in preparation of
solicitation documents and evaluation of
bids for contracts handled at NAROSEC.
5.
Insufficient staff at NARO Additional Procurement Specialist to be hired As specified in EAAPP
Secretariat to handle under the IDA supported EAAPP documents
procurement in a timely
Hire Procurement Assistant at NARO December 2010
manner
Secretariat to support the Procurement and
Disposal Unit with the clerical procurement
tasks, which would give the procurement
officers more time to handle the major
procurement and monitoring of procurement
at the institutes. Assigning contract
management to user departments will also free
some time for procurement staff.
6.
Bids currently received by Ensure that all bids are received in the May 31, 2010
the Office of the Director Procurement Unit.
General rather than the
Procurement Unit
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Risk Action Completion Date
7.
Delays in contracts Schedule contracts committee meetings on a May 31, 2010
committee approvals due fixed schedule.
to non-availability of
contracts committee
members
8.
Insufficient experience in At least 1 of the procurement staff to attend Prior to procurement of
the procurement of training in ICT procurement information systems
information systems
9.
Insufficient technical Chief Information Officer to be hired to Prior to
expertise to support support NARO and NAADS and NAADS in- commencement of
procurement and contract house ICT team to be strengthened procurement of
management for ICT information systems
procurement
14. NAADS Secretariat: The Secretariat has a Procurement Unit with three Procurement
Officers and a fully established Contracts Committee. The procurement staff have experience in
the procurement of goods but have limited experience in the selection of consultants under
World Bank procedures. The NAADS Secretariat is also responsible for developing community
procurement guidelines and monitoring procurement by the communities under the NAADS
program. The key risks for procurement at the secretariat include: (i) the inadequate
organizational structure for the Procurement Unit, with procurement staff reporting to the
Manager, Finance and Administration; (ii) inexperience of procurement staff in the selection of
consultants using World Bank procedures; and (iii) inadequate procedures for the selection of
partners for PPPs planned under component 4. The risk rating for NAADS is substantial. A
summary of the risks and mitigation measures follows (Table 8-F):
Table 8-F: Procurement risks and mitigation measures for NAADS
Risk Action Completion Date
1. Inadequate organizational structure for the Head of Procurement Unit By project
procurement unit, with the procurement staff position to be established at a effectiveness
reporting to the Manager, Finance and managerial level in the
Administration, who represents the function at a organization, with the Head
strategic level in management. This results in reporting directly to the Executive
inadequate supervision in the management of the Director and participating in
procurement function. There is also inadequate management.
participation of the function at a strategic level in
the organization and the program. Lack of
adequate seniority also creates governance risks
for the procurement function
2. Limited experience of procurement staff in the Procurement staff to attend Within 1 year of
selection of consultants using World Bank training in the selection of project
procedures consultants using World Bank effectiveness
procedures at ESAMI or GIMPA
within 1 year of effectiveness.
3. Insufficient experience in the procurement of At least 1 of the procurement staff Prior to
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Risk Action Completion Date
information systems to attend training in ICT procurement of
procurement information
systems
4. Insufficient technical expertise to support Chief Information Officer to be Prior to
procurement and contract management for ICT hired to support NARO and commencement
procurement NAADS and NAADS in-house of procurement
ICT team to be strengthened of information
systems
15. Higher Local Governments56: Limited Procurement will be done at the higher local
governments. Formally established structures exist at this level with each Higher LG having a
Procurement Unit to conduct procurement and a Contracts Committee to review key stages of the
process. Higher LGs may also procure on behalf of the subcounties where the latter determine
that they would benefit from bulk procurement. The key risks at this level are the (i) inadequate
capacity and experience in conducting procurement and (ii) slow processing of procurement.
However given the relatively limited volume of procurement at this level, the risk rating is
moderate. This risk will be mitigated by (i) training of procurement staff at this level being
carried out under the IDA supported Local Government Management and Service Delivery
Project and (ii) NAADS Secretariat orienting the district procurement staff and preparing the
standard documents especially in cases where procurement is delegated to the district. The
justification for each instance of such delegation shall however be subject to IDA's prior review.
16. Lower Local Governments:57 At the subcounty level, farmers' representatives will
participate, together with the LG subcounty staff (Subcounty Chief, Subcounty NAADS
Coordinator), in a Procurement Committee responsible for procurement at that level. This
committee will be responsible for procurement of items that are not available within the district.
Involvement of the farmers is necessary not only to ensure their participation but also to promote
transparency in procurement as established government procurement structures do not exist at
the subcounty level. The key risk for procurement at the subcounty level as evidenced under
NAADS is collusion between the LG staff, Procurement Committee members, and suppliers,
leading to partial delivery of inputs, delivery of substandard inputs, and overpricing of inputs.
The main opportunities for collusion arise from (i) elite capture of the Procurement Committee at
the subcounty level; (ii) inadequate accountability and reporting by the community
representatives on the committee to their communities, leading to lack of information at the
community level for monitoring; and (iii) inadequate monitoring of procurement at the
subcounty level by the higher LGs. The risk rating for procurement at this level is high. The
mitigation measures are indicated below (Table 8-G) and will be complemented with GAC
arrangements (see Annex 9), which will focus on ensuring that adequate information is available
in the public domain to allow proper monitoring.
56
Higher Local Governments include District, City, and Municipality governments.
57
Lower Local Governments include a Municipality, Town, Division and Sub-County Councils.
119
Table 8-G: Procurement risks and mitigation measures for lower LG levels
Risk Action Completion
Date
1. Elite capture of the 1. Subcounty Procurement Committees shall be To be
Procurement Committee at the required to publish their decisions on selected implemented
subcounty level, resulting in suppliers, contract prices, and expected quantities throughout the
collusion and, in turn, within the community (for example, at the project life. The
overpricing and partial subcounty offices, district offices, and other requirements
deliveries public places). shall be specified
in the Revised
Inadequate accountability and 2. The NAADS Secretariat, in conjunction with the
Subcounty
reporting by the community districts, shall provide indicative prices of
Procurement
representatives on the commonly procured items to the subcounties.
Guidelines,
committee to their
3. Subcounty Procurement Committees to be which shall be
communities, leading to lack of
composed only of farmer fora representatives. subject to IDA's
information at the community
approval prior to
level for monitoring 4. The NAADS Secretariat shall provide market project
prices for commonly procured items to the effectiveness
communities and sub counties.
2. Inadequate monitoring of 1. Subcounties shall be required to report on their Quarterly during
procurement at the subcounty procurement to the higher local governments on a implementation
level by the higher local quarterly basis, with the latter reporting on the
governments same to PPDA as per the PPDA and Local
Government Act.
2. The NAADS Secretariat shall hire consultants, Annually
with qualifications acceptable to IDA, to conduct
annual performance/technical audits of
procurement and implementation at the
subcounty and community level.
17. Community procurement. Under the predecessor NAADS project, in some districts the
GoU piloted community procurement arrangements involving farmers, and these proved
successful in ensuring transparency, farmer participation, and farmer ownership. This approach
will be scaled up under ATAAS. At the community/parish level, farmer groups in the parish will
elect representatives to the Parish Community Procurement Committee, which will be
responsible for conducting procurement on behalf of the farmers in that community. Since funds
are retained at the subcounty level, the Subcounty Chief is responsible for signing contracts with
and paying suppliers recommended by the community. Further details are contained in the
Community Procurement Guidelines, which will be updated and then subject to review by IDA.
The key risk for procurement at the community level is elite capture by some committee
members, politicians, LG staff, and/or the committee. The risk rating for procurement at this
level is substantial. The mitigation measures are indicated below (Table 8-H) and will be
complemented by the Transparency, Accountability, and Anti Corruption Program (Annex 9).
120
Table 8-H: Procurement risks and mitigation measures for communities
Risk Action Completion Date
1. Elite capture by some 1. The revised guidelines shall emphasize the need Guidelines shall
committee members, for collective decision making by the Procurement be revised and
politicians, local government Committees. approved by IDA
staff, and/or the committee by negotiation.
can result in partial delivery The revised
2. The Procurement Committees shall be required to
of inputs, delivery of guidelines shall
publish their decisions on selected suppliers,
substandard inputs, and specify the
contract prices, and expected quantities within the
overpricing of inputs procedures or
community.
publication of
3. Community Committees shall have a two-year opportunities and
term renewable once to ensure that communities awards and the
have a mechanism for holding them to account in election of
the event of poor performance. community
procurement
4. The project shall pilot the release of funds to the committee
farmer fora as the community representatives to members.
test the viability of allowing communities full
responsibility for procurement and payment of
suppliers. The pilot shall be done using the
subcounty challenge fund
Annually
5. The NAADS Secretariat shall hire consultants,
with qualifications acceptable to IDA, to conduct
annual performance/technical audits of
procurement and implementation at the subcounty
and community levels.
6. The NAADS Secretariat shall regularly provide
Regularly but at
market prices for commonly procured items to the
least twice a year
communities and sub counties.
7. Farmers shall be trained in procurement as part of Through project
farmer institutional development implementation
2. Inadequate quality Part of the project is focusing on enhancing
certification systems for seed/foundation technology certification processes.
technology inputs create the
risk that substandard inputs
will be procured
18. The overall risk rating for procurement under the project is high, with a projected
residual risk of substantial.
19. Table 8-I lists the Procurement Thresholds and procurement methods to be applied in the
Procurement Plan.
121
Table 8-I: Procurement Thresholds to be applied in the Procurement Plan (PP)
Expenditure Contract Value Threshold Procurement Contracts Subject to
Category (US$) Method Prior Review
(US$ )
1. Works Above US$ 5,000,000 ICB All contracts
US$ 100,000 to US$ 5,000,000 NCB As specified in PP
Below US$ 100,000 Shopping None
2. Goods Above US$ 500,000 ICB All contracts
US$ 50,000 to US$ 500,000 NCB As specified in PP
Below US$ 50,000 Shopping None
3. Consulting With firms above US$ 200,000 Quality and Cost All contracts
Services58 and Based Selection
Training
With individuals above Individual All Contracts
US$ 100,000
With firms up to US$ 200,000 Qualifications/Other None
With Individuals up to Individual None
US$ 100,000
4. Non-consulting Above US$ 500,000 ICB All contracts
Services
US$ 50,000 to US$ 500,000 NCB As specified in PP
Below US$ 50,000 Shopping None
5. All types of All contracts Sole source / direct
contracts contracting and As specified in PP59
terms of reference
Procurement plan
20. The Borrower, at appraisal, developed Procurement Plans for project implementation
which provides the basis for the procurement methods. This Plan has been agreed between the
Borrower and the Project Team on May 11, 2010 and is available at NARO Secretariat, Plot 1-3
Lugard Avenue, Entebbe and at NAADS Secretariat on Plot 39A Lumumba Avenue, 2nd floor
Mukwasi house. It will also be available in the project's database and in the World Bank's
external website. The Procurement Plan will be updated in agreement with the Project Team
annually or as required to reflect the actual project implementation needs and improvements in
institutional capacity.
58
A shortlist of consultants for services estimated to cost less than US$ 200,000 equivalent per contract may consist
entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines.
59
Consultancy services estimated to cost below US$ 5,000 equivalent will not be subject to prior review by the
Bank subject to their inclusion in the agreed Procurement Plan.
122
ATTACHEMENT 1 : Details of the procurement arrangement involving international
competition.
1. Goods and Works and non consulting services.
NARO
Ref No Contract (Description) Estimated Procurement P-Q Domestic Review by Expected
Cost (US$) Method Preference Bank Bid
(yes/No) (Prior/Post) Opening
Date
IFB No. Workshop and Laboratory 5,355,000 ICB Post No Prior Review April 30,
ATAS- equipment (Assorted)- Lot 1- 2011
GOODS- Workshop equipment ; Lot 2-
001 Laboratory Equipment and
Furniture; Lot 3-Laboratory
Supplies and consumables
IFB No. Motor Vehicles - Lot 1- Pick- 3,173,000 ICB Post No Prior Review Sept 30,
ATAS- Up's (40) ; Lot 2-Sedans (2); 2010
GOODS- Lot 3- Station Wagons (18);
002 Lot 4-Lorries (2); Lot 5- Vans
(5); Lot 6- Motor Cycles (58
No)
IFB No. Tractors with Implements (11 550,000 ICB Post No Prior Review Nov 30,
ATAS- No) 2010
GOODS-
003
IFB No. Generators and Water 1,105,000 ICB Post No Prior Review July 30,
ATAS- equipment -Lot 1 -Generators 2011
GOODS- (21 ); Lot 2- Water Pumps (4)
004
IFB No. Furniture - Lot 1- Tables (130); 633,000 ICB Post No Prior Review Jan 30,
ATAS- Lot 2- Set of three Chairs 2011
GOODS- (130); Lot 3- Book Shelves
006 (130)
123
NAADS
Estimated Domestic Prior or Bid
Proc Pre-or Post
Ref No Description* Amount Preference Post closing-
Method Qualification
in US$ '000 (Y/N) Review opening
4WD Vehicles for Districts and
NAADS Secretariat ( Lot 1: 39
GD- pickups for year one, Lot 2: 32 November
2,660.00 ICB Prior NO Prior
001 pickups for year two, Lot 2: 05 5, 2010
4WD Station Wagons for
secretariat)
Motorcycles for Districts Lot 1 (241
GD- November
for FY10/11) and Lot 2 (241 for FY 1,687.00 ICB Post NO Prior
002 17, 2010
11/12)
Framework Contract - Water for
Production (Lot 1: electrical water
GD- January 6,
pumps, lot 2: solar water pumps, 375.00 NCB Post NO Prior
010 2011
Lot 3: water tanks, Lot 4:
generators)
2. Consulting Services.
(a) List of Consulting Assignments with short-list of international firms.
NARO
Ref No Description of Assignment Estimated Selection Review by Expected
Cost (US$) Method Bank Proposals
(Prior/Post) Submission Date
IFB No. ATAS- Supervision Services for works for 300,000 QCBS Prior October 20, 2010
SRVCS-012 construction and rehabilitation of
NARO infrastructure
IFB No. ATAS- Chief Information Officer 300,000 SIC Prior NA
SRVCS-013
IFB No. ATAS- ICT Infrastructure needs and 800,000 QCBS Prior March 25, 2011
SRVCS-014 optimization consultant
IFB No. ATAS- ISO Certification of NARO 180,000 LCS post May 22, 2011
SRVCS-016 processes
124
NAADS
Ref No Description of Assignment Estimated Selection Review by Expected
Cost (US$) Method Bank Proposals
(Prior/Post) Submission
Date
Quality assurance of Farmer Institutional
Development in Lot 1: Northern Region,
August 9,
SV-003 Lot 2: Karamoja Region, Lot 3: Eastern QCBS 333,500 Prior
2010
Region, Lot 4: Western Region and Lot 5:
Central Region (2 year contract phased)
Consultancy for development of content
and translation of broadcasting of September 13,
SV-007 QCBS 200,000 Prior
agricultural advisory services phased over 2010
two years
Capacity development and training of
district, sub county staff to support
farmers in enterprise selection for each
September 29,
SV-009 region in Lot 1: Northern Region, Lot 2: QCBS 1,530,000 Prior
2010
Karamoja Region, Lot 3 Eastern Region,
Lot 4: Western Region, Lot 5: central
Region phased over two year period
Consultancy for high level value chain
November 9,
SV-011 analysis involving key players at national QCBS 700,000 Prior
2010
level platforms
Consultant for gross margin analysis a December 2,
SV-012 QCBS 200,000 Post
minimum of 10 enterprises per year 2010
Capacity development and accreditation of December 17,
SV-013 QCBS 200,000 Post
input dealers for two years 2010
Consultant to generate and disseminate
December 7,
SV-014 market information generation to guide QCBS 200,000 Prior
2010
and integrate farmers in markets.
Consultancy for the management of the December 22,
SV-015 QCBS 250,000 Prior
selection process for NAADS competitive 2010
125
Ref No Description of Assignment Estimated Selection Review by Expected
Cost (US$) Method Bank Proposals
(Prior/Post) Submission
Date
grants
Contracting a professional audit firm to
March 25,
SV-018 carry out annual statutory audits for three LCS 800,000 Prior
2011
years
Contracting a professional audit firm to
carry out limited quarterly audit/ systems
audit/ procurement phased over two years September 8,
SV-019 LCS 842,000 Prior
2010
Performance/VFM audits of NAADS
January 7,
SV-020 program in sub counties districts over two QCBS 561,000 Prior
2011
year period
Consultancy for Impact Assessment
October 9,
SV-024 Studies (Baseline, Midterm and End of QCBS 1,800,000 Prior
2010
term) phased over the program life
Feasibility study on provision of portal for January 7,
SV-025 QCBS 400,000 Prior
internet and mobile applications 2011
Frequency of procurement supervision
21. In addition to the prior review supervision to be carried out from IDA offices, the
capacity assessment of the implementing agency has recommended six-monthly supervision
missions to visit the field, including at least one mission to carry out a post review of
procurement actions. The Post Procurement Review shall be complemented by the Technical and
Performance Audits.
126
Annex 9: Governance and Anti-Corruption Arrangements
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
1. Owing to its scale and success in delivering services to a broad range of farmers and
other stakeholders, the NAADS Program has become vulnerable to the widespread problem of
corruption, raising concern about how the program is implemented and its resources used. Since
NARO and NAADS together represent the lion's share of public resources directed at
agriculture, it is important that the GoU, IDA, and other DPs remain fully engaged to ensure that
these investments efficiently promote pro-poor growth in Uganda. A key aspect of this
engagement is a governance framework that facilitates efficiency and transparency and inhibits
corrupt practices in the use of public resources. These Governance and Anti-Corruption (GAC)
arrangements will create a positive feedback loop of increased transparency, credibility,
consolidation, and appreciation for state authority.
2. The GAC arrangements for ATAAS build on the standard fiduciary accountability
measures discussed in detail in Annexes 7 and 8. The framework provides for a review of the
implementation guidelines to ensure that transparency, fiduciary, regulatory, gender, and social
accountability measures are clearly operationalized under ATAAS. The GAC arrangements are
aligned with the GoU's anti-corruption frameworks and institutions. ATAAS will provide
funding to strengthen measures to ensure transparency and accountability, using the project as an
entry point for the development and implementation of improved governance systems that
communities and local authorities can use. The framework uses improved ICT for more
extensive disclosure and transparency, contains a more effective complaints mechanism, and
draws on the key principles of good governance in World Bank projects.
Governance and anti-corruption at the country level
3. Instances of large-scale corruption entailing significant losses of public funds have
occurred in Uganda through mishandled procurement and outright embezzlement. Other forms of
corruption include bribes, nepotism, patronage, and clientelism. In some cases, civil insecurity
has provided opportunities for profiteering. The GOU's capacity to deal with poor governance
and corruption has been constrained by legal complexities (burden of proof) and limitations on
sanctions, and undermined by poorly resourced institutions for public accountability. To address
these issues, the GoU is pursuing a combination of reforms at the national level. Key initiatives
include: (i) the creation of a legislative framework for public finance management; (ii) service
delivery arrangements under the sector wide approach; (iii) the decentralization of political,
administrative, and fiscal authority to LGs; (iv) public sector management reforms to regulate
human resource recruitment, remuneration, and performance; and (v) the creation of regulatory
institutions to ensure compliance with national standards in several sectors. Progress so far has
been mixed. The Corruption Perceptions Index remains below 3.0 (2.5 in 2009 and 2.8 in 2008),
putting it among the weak performers. Results from the third National Integrity Survey60 (NIS
III-2008) also show that corruption is perceived to be increasing. The continued proliferation of
districts has weakened institutional effectiveness and impeded reforms in public financial
management (including procurement reforms). The limited capacity within LGs, which are
60
The NIS III is the most comprehensive survey done in Uganda to look at governance and anti-corruption in
service delivery. It is led by the Office of the Inspector General of Government.
127
mandated to deliver social services, has negatively affected service delivery. The key public
institutions charged with regulation also suffer from weak capacity.
4. Public Financial Management (PFM): The PFM final Management Performance Report
2008, published in June 2009, described Uganda as having made tremendous progress in
improving its PFM in recent years. The report also detailed various remaining challenges:
Comparing performance in late 2008 against performance three years earlier, the report found
that 11 indicators appeared to have improved, 12 remain unchanged, and 7 had deteriorated.
Nevertheless, substantial progress has been made. PFM has been a particular focus of
development partner assistance, through the Financial Management and Accountability Program.
This program has been extended with an ambitious new strategy aimed at strengthening
budgeting, financial management, audit, and procurement systems. Substantial work remains to
be done at the LG level, however, to achieve results on the ground.
5. Procurement: To ensure that public procurement and disposal is conducted in a fair,
transparent, and non-discriminatory manner, the government in 1997 embarked on far-reaching
procurement reforms that involved the following measures: (i) disbanding the Central Tender
Board; (ii) decentralizing the public procurement and disposal function to Procuring and
Disposal Entities; (iii) creating Contracts Committees and Procurement and Disposal Units to
service Procuring and Disposal Entities; and (iv) liberalization of third-party procurement
providers. These reforms were aimed at professionalizing and depoliticizing procurement in
public entities. In 2003, the Public Procurement and Disposal of Assets regulations were
promulgated and the PPDA established. The regulations provided guidelines for public entities
(both central and local). The PPDA does not approve procurement or disposals (this is done by
Procuring and Disposal Entities) and has no involvement in individual tenders or contracts,
except in reviewing appeals and conducting administrative reviews of procurements. In 2007 the
GoU began to revise the PPDA Act to strengthen enforcement and ensure that procurement is
less discretionary. The PPDA reports to the Minister of Finance, Planning and Economic
Development, and it has the following functions: (i) oversee policy and regulations on public
procurement and disposal; (ii) regulate the sector and provide standards, guidelines/advice, as
well as audit procurement and disposal; (iii) monitor compliance of all GoU entities with
established standards, procurement guidelines, and disposals.
6. Civil Society Engagement: National and regional CSOs increasingly participate in the
anti-corruption discourse. Organizations such as the Uganda Debt Network, the Anti-Corruption
Coalition in Uganda, and Advocates Coalition for Development and Environment are examples.
The GoU is defining ways to guide these collaboration efforts. Through the Access to
Information Act (2005), the GoU aims to facilitate CSOs' access to key information that can be
shared with communities to raise awareness and ensure better accountability from leaders.
Key principles of good governance in IDA projects
7. Mainstreaming governance in IDA operations is based on three key principles of good
governance: transparency, accountability, and participation.
8. Transparency implies openness and visibility, and it should apply to the conduct of all
governmental affairs. As a foundation for accountability and participation, transparency
facilitates good governance; its absence provides cover for conflicts of interest, self-serving
deals, bribery, and other forms of corruption.
128
9. Accountability has both internal and external dimensions. Internal accountability implies
probity in how and why resources are mobilized and used; it involves issues of financial
accountability, efficiency, and effectiveness in the collection of taxes and other revenue, in the
creation of public goods, and in the delivery of basic services. External accountability refers to
political leaders' responsiveness to citizens' needs and aspirations, including accountability for
the overall performance of the economy (sustainable growth and job creation) and for the level
and quality of basic services. Such accountability implies that the institutions--including the
civil service--have the capacity to respond to citizens' demands, and that salary levels and other
incentives are consistent with those expectations.
10. Participation, or inclusion, represents the demand side of governance and implies that
people have rights that need to be recognized; that they should have a voice in the decisions that
may affect them; that they should be treated fairly and equally; and that they should benefit from
the protection of the rule of law. The benefits of participation are well documented: They are
particularly important in decisions on the types of investment projects to be done, their design
and implementation, and their operation and maintenance. The involvement of CSOs, consumer
groups, project beneficiaries, and affected communities in all stages of IDA-financed projects
can improve development outcomes while reducing the scope for fraud and corruption.
The Governance and Anti-Corruption Arrangements for ATAAS
11. The GAC measures for the ATAAS build on the key principles cited above. The
framework goes beyond the IDA's minimum fiduciary procedures and presents measures to
improve internal and external accountability of the NAADS Program, especially at the LG level,
and to link communities to national anti-corruption strategies. Given the decentralized
implementation of NAADS, it is imperative that an improved incentive structure be put in place
for LG. The revised implementation plan, guidelines, and manuals include clear and enforceable
mechanisms recommended by the GAC. The GAC measures for ATAAS are built on three major
blocks, aiming to (i) build accountability for performance into the national-local government
interface; (ii) mitigate inaction on budget, finance, procurement and other implementation risks;
and (iii) improve external accountability (see detailed Action Plan in Table 9-A).
12. Building accountability for performance into the national-local government
interface. ATAAS will lay emphasis on streamlining the relationships between the national and
local government levels by (i) integration of eligibility criteria, performance targets, rights and
obligations, rewards and sanctions at the national level and into MoUs with districts; (ii)
performance contracts of specific ATAAS actors; and (iii) improved oversight of LGs.
13. Building on the ongoing LG assessment process, mechanisms for rewards and sanctions
at various levels of project implementation will be detailed in the PIM. Sanctions will include
suspension of disbursement to LGs and communities that violate project rules and guidelines,
including delays in reporting as specified in the PIM. Sanctions will also be applied as per
Government Standing Orders for civil servants and in line with nationally accepted corrective
practices in cases of proven corruption. To this end, links with specific investigative arms of
government will be strengthened to investigate reported cases of corruption, poor accountability,
or abuse of office, including violations of project rules and procedures.
14. Mitigating inaction on budget, finance, procurement and other implementation
risks. The design of ATAAS strengthens the budget, financial and procurement management
129
systems. In addition, the GoU is implementing a public financial management reform strategy
including the IDA-funded Financial Management and Accountability Program. This includes an
audit and procurement component to improve the management of public resources and reduce
opportunities for corruption. ATAAS will track linkages to these ongoing reforms.61 ATAAS
will supplement these with activities in the following four areas: (i) publicize review findings;
(ii) maintain a categorized list or database of governance of financial management, procurement
and corruption identified within the project; (iii) conduct periodic performance audits; and (iv)
conduct needs-based forensic audits. The project will also carry out (i) functional analysis of
NARO and NAADS at the national and LG levels and (ii) strengthen the project M&E. The joint
results framework of the project will include measurable GAC indicators, to track the progress in
good governance and support the participatory monitoring and streamline M&E feedback
mechanism to the districts, sub-counties, and farmer groups.
15. Improving external accountability. The third component of GAC strategy will address
the demand side for accountability through (i) better disclosure of information; (ii) public
awareness campaign; (iii) strengthened complaint mechanisms; and (iv) better links with non-
state actors and communities. The project will increase the availability of critical information to
the public on beneficiaries, budgets, contract awards, performance and results. Better disclosure
of information at the local level will encourage more oversight by beneficiary farmers. A
disclosure strategy has been agreed upon and will include enhanced disclosure on the website
and links to a mobile handset program to allow farmers to access information easily.
16. Using a development communications strategy, clear information will be provided to
potential AASPs, LGs, communities, and other stakeholders. This will include detailed project
guidelines, implementation structures, accountability requirements, and beneficiary details across
all components. Record-keeping will be enhanced to ensure that there is a detailed plan for
proper up-keep of all documentation related to the program, especially program procurement and
financial records, ready for disclosure. The monitoring and MIS systems will monitor key
variables and indicators, including issues or complaints raised by farmers, to identify potential
sources of fraud and corruption, will also be publicly disclosed. The program will also institute
external (NGO) monitoring, including citizen report cards.
17. The communities will use various social accountability mechanisms to hold each other as
well as GoU officials and bureaucrats accountable. The project will strengthen NAADS
complaints line program to facilitate detection of irregularities in project activities. An
independent monitor will record complaints and work with anti-corruption agencies to facilitate
immediate investigation of complaints. In addition, the use of ICT will improve the ability to
register complaints through the website and the use of SMS messages.
18. The grievance-handling system will, depending on the severity and potential criminal
liability of a given transgression, invoke referrals by ATAAS to: (i) the disciplinary regulatory
system of MoLG (for LG employees at the district level and below); (ii) the internal governance
for all levels of civil servants and elected government officials, in accordance with the
constitutional roles; (iii) the police, the Directorate of Public Prosecution, and the judiciary. In
sum, the project will ensure that an effective complaints handling mechanism with adequate
protection of whistleblowers is installed and tested early in project implementation.
61
The PPDA managed to conduct 27 procurement audits in 2007/08, increasing the number of audits to 51 in
2008/09.
130
Table 9-A: GAC Action Plan
Governance risk Proposed action Key milestones for Responsibility centre Timing
monitoring indicators
1. Inadequate performance Accountability mechanisms
a)
accountability at all levelsb) National level:
i. Adopt annual agency GAC targets included in Leadership of MAAIF, From project start-
performance contracts between Annual NAADS/NARO NAADS/NARO up.
MAAIF/NAADS &NARO. Work-Plan and Budget management & DP
agricultural sector
representatives.
District & sub-County:
CAO and DPOs.
ii. Review NAADS/District Annual district GAC Working Group to From project start-
Participation Agreements. performance targets back-stop the up.
(inclusive of GAC targets) implementation of this
agreed upon and Action Plan62.
monitored by
NAADS/NARO and
Participating districts
iii. Track and Report action against Indicator integrated in LG Baseline:
governance, financial Assessment immediate.
management, procurement and Framework/Joint Results Monitoring:
corruption indicators. Framework thereafter.
2a. Address budget, i. Publicize Findings and Follow up % compliance with NAADS and NARO (i-iii) Audit:
finance & procurement Action Plans. Performance Audit Immediately
risks Follow Up Action Plans following approval
of Action Plans
Maintain a ledger/data-base of Improved follow up NAADS and NARO (iv) Publish
governance financial management, practices and more information:
procurement and corruption issues effective audits lead to an Continuous.
identified within the program. increase in the percentage
of clean or low risk
cases.
62
This multi-stakeholder body should have representation from the heads of NAADS, NARO and MAAIF, MOLG, DP, CSO and private sector representatives and inspection units' representatives
from below, to feed back and take action at appropriate levels. To be tasked with development of functional working relationships with accountability-improvement agencies at all levels.
131
Governance risk Proposed action Key milestones for Responsibility centre Timing
monitoring indicators
ii. Conduct periodic Performance No of audits
Audits conducted(output)
iii. Conduct needs based forensic Improved follow up result
audits in an increase in the
number of needs driven
forensic audits; and to
procurement audit
findings which lead to
investigations, legal or
administrative sanctions
(IG, DSC, PSC, etc.)
2.b Mitigating National level
implementation risks
i. Conduct functional analyses of Plan to fulfill MAAIF /NAADS and By end 2011
both NAADS and NARO, as an National/District/Sub- NARO
integral part of MAAIF's County ATAAS
institutional restructuring exercise. Institutional Requirements
Policy adoption of
eligibility criteria
ii. Adopt and publicize ATAAS
program District eligibility Percentage increase in MAAIF, NAADS, By project start up
criteria63 staff strength to support NARO
ATAAS program at
district level
District level
i. Functional analyses of Audit and MAAIF. Project Start Up
Production Departments and
Procurement Units at Secretariat,
District and sub-County levels.
CAO, in consultation
ii. Publicize existence of complaints with NAADS 1st year of program
handling mechanism. Secretariat.
63
Reference to Local Government Assessment Framework.
132
Governance risk Proposed action Key milestones for Responsibility centre Timing
monitoring indicators
3. External National Level
Accountability i. Public awareness campaign64, Public awareness NARO and NAADS (i) & (ii) to begin
aimed at: a) building confidence campaign results in a 10 immediately
and b) emphasizing the new percentage point (communications'
improved governance message. improvement in the share strategy).
of public (rural/urban) Implementation
ii. Website to include easy-to-read aware of the ATAAS thereafter.
and up-to-date information on program anti-corruption (iii) From start-up.
funds' flow, contracts awarded, drive (iv) From end-2011
audit findings, technical
performance and results.
District Level
i. Display of ATAAS budget Templates of information NARO and NAADS (i) & (ii) From
transfers, tender to be displayed developed start-up.
outcomes/contract awards' and availed
information65 on District, sub-
Country and community notice
boards.
ii. Conduct ATAAS citizen service Baseline satisfaction NARO and NAADS
delivery survey through citizen survey
score-cards, independent enquiries
and community advocacy.
iii. Implement campaign to CSO, Private Sector/ Districts, NARO and (iii) By end-2011
collaborate with CSOs, private Media actively participate NAADS
media and private sector in public at regular reviews at all
accountability fora, such as levels
community barazas.
iv. Design an effective complaints % increase in victims of NARO and NAADS (iv) Immediate
handling mechanism; corruption utilizing the
complaints mechanism as
an avenue of recourse.
64
To include regular briefings of Cabinet on policy, eligibility criteria, technical impact analysis and financial issues.
65
Minutes of decisions taken at all meetings dealing with ATAAS procurement matters.
133
Annex 10: Economic and Financial Analysis
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
A. Introduction
1. This economic analysis of ATAAS assess whether it is likely to yield sufficient returns to
justify its costs. The economic analysis is complemented by sensitivity and risk analyses to test
the robustness of the results. The annex concludes with an assessment of the fiscal impact of
ATAAS. Working Document 8 in Project Files (Annex 14) presents a discussion of the general
issues related to the economic analysis of agricultural R&D projects, including a summary of the
literature on returns to investments in such projects and returns to past investments in agricultural
research and extension projects in Africa and in the world.
B. Economic analysis of ATAAS
2. The economic analysis uses the minimum national impact assessment, which identifies
the minimum annual growth rate in net farm income (across full area cultivated) required to
attain an ERR of 12 percent (the breakeven point), assuming a certain proportional increase in
farm costs arising from the adoption of more input-intensive technologies. This method is often
used to identify the minimum incremental benefit stream that would justify the proposed
investments (in this case, the investment under ATAAS).
Basic assumptions
3. The analysis examines the combined impact of research and extension. Investments in
research and advisory services are very much interrelated. Given the data available, the estimated
IRR is not adjusted for inflation; externalities (environmental effects, institutional strengthening,
capacity building, and social impacts) are not measured, meaning only private IRR is estimated;
and the economic rather than financial IRR is estimated, given the low distortions in Uganda for
both tradable (price distortions) and non-tradable (cost distortions) markets.
4. The analysis focuses on several commodities (enterprises) promoted under NAADS in
Uganda: sorghum, maize, cassava, Irish and sweet potatoes, millet, sim sim, groundnuts, beans,
bananas, coffee, and cotton. These crops cover about 80 percent of Uganda's cultivated area.
Note that the highly diversified mix of agricultural outputs in Uganda is produced in an equally
diverse range of agro-ecologies (11 AEZs are identified by the research system). Uganda's range
of crops and environments sets it apart from neighboring Kenya and Tanzania, where most farms
produce maize and rice, the major staples.
5. The benefit streams from ATAAS would originate from four sources: (i) increased yields
from more intense use of inputs; (ii) increased yields from growth in TFP; (iii) shifts in the
enterprise mix to more profitable commodities; and (iv) higher farm-gate prices as a share of
wholesale prices, arising from stronger agribusiness and greater integration of smallholders in
the value chains. The ERR is assessed for a period of 20 years.
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6. Output prices: Household survey data show that farm-gate prices are approximately 80
percent of wholesale prices in Uganda. Wholesale prices were taken from the NAADS Impact
Evaluation and verified by information from FEWSNET.
7. Input costs: Farm budgets include variable costs (inputs), labor costs, and other fixed
costs. The variable cost data are most accurate; labor and fixed costs are difficult to attribute to
specific crops, given the large mix of enterprises in Uganda. It is assumed, based on the available
data, that labor costs equal 80 percent of total variable costs, and fixed costs equal 20 percent of
total variable costs across the selected crops. The analysis uses input costs for low-performing
farms and high-performing farms (in terms of gross farm income/margins) according to the
NAADS Impact Evaluation. As more farms shift from low-input technologies to higher input
technologies, it is assumed that their costs change correspondingly.
8. Off-farm costs: Almost all ATAAS costs are off-farm costs. For the first five years, the
off-farm costs incurred under ATAAS are estimated at UShs 260,400 per year. The first five
years include ATAAS investment costs, and thereafter only recurrent and maintenance
expenditures are costed. Starting from year 10, total off-farm costs are assumed to be 80 percent
of ATAAS annual costs.
9. Gross margins: Gross margins are estimated as revenues minus variable, labor, and fixed
costs. Thus gross margins are the return to farmland.
Scenarios
10. Baseline scenario: The baseline (without-project) scenario, derived from NAADS data,
assumes that farm production technologies remain the same and that there is no increase in
benefits (yields, enterprise mix, and prices).
11. ATAAS scenarios: Three scenarios were developed for ATAAS. The first scenario
assessed incremental returns from increasing farm yields, assuming no changes in enterprise mix
or output prices. The second scenario assessed the incremental returns from increased yields and
a shift in enterprise mix to higher value-added commodities.66 The third scenario assumes that
farm prices as a share of wholesale prices will increase by 3 percent annually as a result of
greater agricultural commercialization, producer groups' stronger bargaining position, and the
promotion of agribusiness under ATAAS.
Results
12. Scenario 1: To obtain an ERR of 12 percent on the proposed investments in agricultural
research and advisory services in Uganda under ATAAS, it is sufficient to generate an average
increase in national farm yields of 0.67 percent every year or net increases in productivity of
more than 13.4 percent compared to the baseline (without the project). The projected increase in
yields is assumed to be induced by growth in TFP and more intensive input use.
66
The second scenario assumes that low-performing farms retain the same commodity mix on 70 percent of their
cultivated area during the observed period but shift 30 percent of the area to the three most profitable commodities
(based on the NAADS Impact Evaluation). The profitability of various crops varies over time and depends on many
factors, but for simplicity the analysis uses data from 2004 and 2007 to assume certain shifts in enterprise mix. It is
assumed that 10 percent of farms are high-performing farms at the beginning of project implementation, that this
percentage increases every year at a conservative rate of 2 percent, and that it reaches 50 percent of all supported
farmers in 2030.
135
13. Scenario 2: When the effects of TFP and more intensive input use are combined with
changes in enterprise mix, the average yield increase required to attain an ERR of 12 percent is
estimated at 0.41 percent. This annual yield increase would result in an 8.2 percent accumulated
yield increase over 20 years. Net farm incomes would need to grow by 5.2 percent by the
completion of the project and by 28.8 percent at the end of 20 years. These targets for income
growth are achievable, based on past experience in Uganda.
14. Scenario 3: When the impact of projected price increases for farmers are taken into
account (farm/wholesale price ratio is assumed to growth by 3 percent per year), then an average
yield increase of only 0.35 percent is sufficient to attain the breakeven ERR.
15. The estimated increase in yields that is required to attain an ERR of 12 percent seems
attainable, given past experience in Uganda and other developing countries.
Sensitivity analysis
16. Results of the initial analysis were tested for resilience to elite capture of NAADS and
NARO services, changes in output prices, and changes in transport costs arising from lower fuel
prices and better rural roads. All things being equal, a 25 percent decrease in output prices would
require yields to rise by 47.8 percent (or annual yield growth to rise from 0.35 percent to 0.51
percent). A larger price shock (a 50 percent reduction in output prices) would require an annual
yield increase of 0.69 percent to attain a 12 percent of ERR. Moderate elite capture of the
NAADS Program, resulting in a 50 percent smaller adoption of agricultural technologies than
assumed in the initial analysis, would require yields to grow by 0.42 percent. All of these yield
increases can still be achieved. If the NAADS Program is subject to extreme elite capture,
however--if only 0.1 percent of new farmers adopt new technologies annually--the annual yield
increase required for the project to break even would be about 0.93 percent, which subjects the
project to considerable pressure to achieve the expected benefits. On the other hand, Ugandan
farmers may benefit from positive shocks. For example, if transport prices fall by 20 percent
(because fuel prices are lower, rural roads are better, or larger volumes of commodities can be
marketed), farm yields must rise by 0.28 percent per annum compared to 0.35 percent without
the positive shock. Overall, the sensitivity analysis shows that the required minimum incremental
benefits from the investment are very small in the case of negative shocks and are very likely to
be attained by the project. Thus the investment is justified and potentially viable.
C. Fiscal analysis
17. Fiscal analysis seeks to assess the likely fiscal impact of the project on GoU's budget,
which may affect its co-financing to the project. Between 2007/08 and 2009/10, public spending
on research and advisory services (R&E) in Uganda was about UShs 100 billion per year.67 This
was about 50 percent of the budget for the agricultural sector, about 2 percent of the national
budget, and 1.3 percent of agricultural GDP. The GoU's commitment to research and advisory
services remains high. Given that NARO and NAADS are a part of the Prosperity for All's
expenditure, and are designated Poverty Action Fund (PAF) activities, the risk of the GoU not
meeting its MTEF targets for these organizations is low. Agricultural R&E is a critical element
of the DSIP, and the GoU has fully committed to continue and even increase its support to the
agricultural technology agenda. Based on current MTEF projections, R&E spending is projected
67
NARO and NAADS belong to MAAIF, and their budgets were not reported separately prior to 2007/08.
136
to grow to UShs 285 billion by 2014/15, and its share in the total sector budget will increase to
63 percent (Table 10-A). Aside from using its own resources to support agriculture, Uganda has
attracted external resources, including ATAAS, as well as EAAPP. The total ATAAS costs
financed by development partners are estimated at US$ 168.2 million over five years (UShs 350
billion at UShs 2,081 per US$ 1).
18. The fiscal impact of GOU commitments: With donor financing, the share of R&E
spending in the government budget will increase to about 3.2 percent, compared to 2.7 percent
without DPs' support. The fiscal impact of such an increase is not substantial, given the
economic and social benefits that the proposed project would bring to Uganda and the public
nature of most services provided under ATAAS. It is also not substantial compared to
international spending. Uganda is projected to spend about 1.5 percent of its agricultural GDP on
agricultural research. On average, developed countries spend about 2.0­2.5 of agricultural GDP
on agricultural research only. The R&E spending in developing countries is typically below 1
percent of agricultural GDP, but many countries allocate more. Kenya, for example, allocated
about 2.7 percent and South Africa about 3.1 percent in 2007. This is another justification for
increased spending on agricultural R&E in Uganda.
Table 10-A: Budget expenditure for NARO and NAADS, without donor funds (UShs b and %)
2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
NARO 25.6 29.8 35.7 36.0 50.0 55.1 60.5 66.6
NAADS 201.0 217.8
60.4 98.2 108.9 136.1 150.7 178.2
Secretariat
Agricultural 393.5 453.9
202.5 223.2 205.6 236.7 278.3 333.3
sector budget
Total 9,775 10,937
government 4,755 5,859 6,939 6,622 7,729 8,261
budget
R&E as a share 42.5 57.3 70.3 72.7 72.1 70.0 66.5 62.7
of sector budget,
%
R&E as a share 1.81 2.18 2.08 2.60 2.60 2.82 2.68 2.60
of total budget,
%
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Annex 11: GEF Incremental Cost Analysis
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
1. The Global Environment Objective of the GEF incremental grant is to enhance the
environmental sustainability and resilience of agricultural production to land degradation and
climate risks. 68 Fully blended GEF support is organized around three sets of activities in the
overall Project. These are: (i) Improving institutional governance by strengthening capacities for
SLM planning and practice (ii) Scaling up on the ground activities for improved natural resource
management (NRM), and (iii) Reducing vulnerability through natural resource monitoring and
knowledge management. These activities are part of baseline component 2 (Enhancing Linkages
between Agricultural Research and Advisory Services), but also reinforce baseline components 1
(Supporting the National Agricultural Research System) and 3 (Agricultural Advisory Services).
For details, see Annex 4.
2. Consistency with GEF programming. The project will directly contribute to the
implementation of the GEF-4 Land Degradation Focal Area Strategy as listed below:
(i) SO-1: An Enabling Environment will place SLM in the mainstream of
development policy and practice at regional, national and local levels
(ii) SO-2: Mutual benefits for the global environment and local livelihoods through
catalyzing SLM investments for large-scale impact
(iii) SP-1: Support to sustainable agriculture and rangeland management.
3. This project incorporates the principles set out in the Strategic Program 1 of the GEF
Land Degradation Focal Area Strategy, and seeks to build a policy and institutional environment
conducive to prevention and control of land degradation and effective actions on the ground, that
protect ecosystem functions, such as carbon stocks and fresh water availability, and
simultaneously improving livelihoods of rural land users including their ability to adapt and cope
with the effects of climate change impact.
4. Consistency with the GEF Strategic Investment Program for SLM in Sub-Saharan Africa
(SIP). The GEF financing will be drawn from the envelope secured for Sub-Saharan Africa by
the Bank-led multi-agency SIP, which is a key activity of the AU-NEPAD TerrAfrica
partnership. As such, the Project conforms to the SIP principles69 and delivers on the SIP goal,
objectives, and SIP intermediate results 1, 2, 3, and 4, as follows:
(i) Alignment with SIP result 1 (up-scaling SLM on the ground): GEF incremental support
will co-finance SLM by communities engaged with NAADS and/or NARO. Baseline
financing funds the vast majority of on-the-ground investment.
68
The project development objective of the baseline co-financing (with which the GEF incremental support is blended) is to
increase agricultural productivity and incomes of participating households by improving the performance of agricultural research
and advisory service systems in Uganda.
69
The SIP principles are: (i) Country has demonstrated commitment to the SLM related objectives of NEPAD's environment and
agriculture programs (CAADP, EAP) and the ECOWAS Implementation Action Plan; (ii) The operation contributes to reaching
SIP results; (iii) The operation commits to using harmonized indicators and benchmarks to measure SLM scale up and progress
toward established goals at regional program level; (iv) The operation exceeds the 1:4 financial leveraging ratio for SIP
operations (GEF: non-GEF). The SIP is a key activity in the TerrAfrica joint work program, in which the Bank, Uganda, GEF
and NEPAD actively participate. Uganda sits on the Executive Committee of TerrAfrica.
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(ii) Alignment with SIP result 2 (enabling environment): Institutions at federal, state, and
local levels are better equipped to manage SLM programs and projects, plan and monitor
across sectors on integrated approaches, and partner with communities to implement
SLM.
(iii) Alignment with SIP result 3 (extension): Advisory services have greater capacity to
promote SLM practice.
(iv) Alignment with SIP result 4 (knowledge and M&E): Better support given for
benchmarking, and decision-making at all levels, via the development and
implementation of an integrated knowledge management and M&E system with
associated monitoring tools, and communication/dissemination strategy and materials.
Incremental Analysis
5. GEF participation is critical in bringing about sector integration and coordination of SLM
and NRM activities at national level, and in catalyzing adoption of SLM practices by farmer
groups ­ and setting the stage for further uptake of SLM and expanded investment in SLM by
the agriculture sector and four other line ministries, and associated sub-sectors of themes
including water, energy, forest, and climate change and variability. Below are the scenarios with
and without GEF involvement.
6. Scenario without GEF: Without GEF involvement, the operation and the agencies and
people it supports would be less able to respond to the country's stated land management agenda,
including supporting the key natural resource ministries, districts and sectors to coordinate on
diagnostics and investment across sectors, and to engage in good governance of the natural
resources under their oversight. The current limited degree of cooperation and coordination
between stakeholders coupled with the current set of ad-hoc or project specific interventions in
the country will not allow the country to scale up SLM or improve NRM in general. Advisory
and research services would not sufficiently articulate or implement their NRM and SLM
priorities without GEF.
7. As a result, the key factors leading to land degradation would not be substantively or
comprehensively addressed. Trade-offs between resource use options within the landscape would
continue on an environmentally unsustainable basis; these include agricultural encroachment into
environmentally sensitive areas, overuse of natural resources in agricultural landscapes, and
resulting downstream impacts. This would result in continuing degradation of rural land-use
systems with consequent loss of ecosystem function, and thus loss in biodiversity benefits, an
increase in carbon releases from vegetation and soil loss, an expansion of the adaptation deficit,
and deterioration of soil quality and hydrological regimes.
8. Scenario with GEF: Responses to these threats to date have fallen short of expectations
due to an entrenched set of barriers in the enabling environment which would be addressed by
GEF involvement. These barriers include:
1. Knowledge needed for SLM uptake is either not disseminated effectively or is unavailable.
Lack of access to or knowledge of best-bet SLM and NRM approaches by communities,
extension and research parastatals (NAADS and NARO), and district government.
Lack of adequate medium to long-term monitoring of ecosystem functions important to
sustain production systems (forest, range, crop).
Lack of comparability of efforts across institutional and geographic boundaries.
139
Lack of a robust ecosystem/landscape monitoring system to inform land-use decision
making at multiple levels
2. Institutional capacities cannot sustain the long-term cooperative effort needed for SLM and
NRM.
Lack of vertical and horizontal sectoral coordination and alliances for SLM, especially
among the extension and research parastatals under MAAIF, but also including MWE,
MLHUD, MTTI, and MEMD and other stakeholders.
Weak governance at multiple levels among land related institutions.
3. Weak policy formulation/enforcement and financing access undermine the incentive mix for
land and water resource users.
Insufficient financing or income amongst land users and GoU to invest in land
conservation.
9. With GEF involvement, the IDA supported program would be better positioned to
address most of the above barriers, thereby improving natural resource management among land
users, in particular farmers and pastoralists and setting the stage for scaling up SLM practice.
This in turn would better secure ecosystem functions in rural production landscapes and the
delivery of the global environmental benefits described below. The MAAIF-led SLM platform
supported by GEF is a key ingredient for sustainability of post-project impact on SLM and
climate risk mitigation. MAAIF is a key to link NARO and NAADS with other implementing
agencies in the sector, and thus coordinate on knowledge, policy alignment and investment in
agriculture and across sectors. This platform is an important ingredient for a future SWAP, as a
programmatic approach is already getting in place for SLM, and it provides a channel for
coordinating climate change interventions in Uganda. This deeply reinforces long-term
sustainability and replicability of Project efforts.
Global environmental benefits
10. The resulting scale up of SLM practice would represent a transformational shift in
Uganda that will generate global environmental benefits by preventing or arresting degradation
of agricultural landscapes and the consequent loss of primary and secondary ecosystem services
in the land degradation hotspots identified above in paragraph 3. Key areas of intervention are
the highly degraded and arid cattle corridor, the Lake Victoria crescent which faces reduced soil
quality, and the Eastern and Northern zones. In all of these areas, the project aims to reverse the
low nitrogen, potassium, and phosphorous balances, build soil organic matter, slow soil erosion,
and expand vegetation cover, as well as slow forest conversions driven by inefficient land
management. This in turn will reduce above- and below-ground biodiversity loss, reduce carbon
releases from vegetation and soil loss, improve soil quality and hydrological regimes related to
Lake Victoria, and reduce the climate adaptation deficit that faces rural land users.
11. Global environmental benefits will be monitored through the development and
application of specific tools compliant with GEF-4 and the SIP umbrella. These are listed in the
Project Framework above and include, among others: vegetation cover and land degradation
severity via Net Primary Productivity and soil quality (including carbon). The Project will also
track adoption rates of SLM practices, which are assumed to lead to the global and national
environmental benefits. These tools will be developed and applied jointly by the participating
140
agencies that are implementing the project, building on experiences and tools available via other
SIP projects, the LADA project, and the GEF's new carbon benefits project.
Incremental Costs
12. The baseline financing is US$ 117.9 million, consisting of IDA and GoU direct co-
financing. The GEF increment is US$ 7.2 million, resulting in a total amount of US$ 125.1
million. This amount corresponds to GEF incremental financing of nearly 6 percent of project
cost. Although this is a meager amount, it is in line with the current SIP co-financing ratio of 1 to
8. In addition, the influence given to the GEF involvement in this Project to date has outsized its
financial contribution, which bodes well for implementation and mainstreaming of SLM practice
and planning throughout the agriculture sector nationwide.
13. The total Project cost of the baseline project is US$ 665.5 million, which is higher than
anticipated at the PIF stage. However, US$ 117.9 million of this baseline is counted as direct co-
financing for the GEF increment of US$ 7.2 million. Overall, IDA is now investing US$ 120
million of which US$ 65.8 million is counted as direct baseline co-financing. The GoU will
finance the major share of the baseline Project costs, allocating a total of US$ 497.3 million over
the five-year project period, of which US$ 52.1 million is also considered direct baseline co-
financing. In addition, although IFAD, the EU Delegation, and Danida are providing additional
parallel financing of US$ 41 million, this contribution is not reflected as direct co-financing to
the GEF increment. The GEF incremental cost should be understood in the context of the broader
program (see Table 11-A for details).
Table 11-A: Incremental Cost Analysis
Component Category Estimated National and Local Global Environmental Benefit
Expenditure Environmental Benefit
(US$)
1. Supporting Baseline 10,000,000 Increased capacity of the No global environmental
the National NARS to identify technology. benefits.
Agricultural Increased capacity for
Research participatory research with
System farmer groups.
With GEF 10,000,000 Note: some spillover national Note: some spillover global
Alternative (There is benefits from Component 2 benefits from Component 2
significant SLM mainstreamed into NARO better able to monitor
influence NARO and the national land productivity and climate
from GEF agriculture research system. risk trends.
investment in SLM increasingly adopted by
component 2) farmers, with global benefits
listed in Component 2.
141
2. Baseline 63,900,000 Improved research-extension No global environmental
Enhancing system better able to: benefits.
Partnerships - operate jointly and
between efficiently
Agricultural - deliver advisory services to
Research, farmer groups
Advisory Increased capacity of NARO
Services, and to deliver technology into
other extension channels.
Stakeholders Increased capacity of
NAADS to put research into
use on the ground.
Increased agricultural
productivity and income
opportunities resulting from
investments in technologies,
improved market access, etc.
With GEF 71,100,000 Improved long-term Prevented or arrested
Alternative productive capacity of degradation of agricultural
smallholders' crop and range landscapes, and the
lands with enhanced land consequent loss of primary
quality, soil fertility, and secondary ecosystem
freshwater ecosystem services. This in turn will
services, and reduced reduce above- and below-
reversed rates of land ground biodiversity loss,
degradation. reduce carbon releases from
Secondary ecosystem vegetation and soil, improve
services deliver increased soil quality (including carbon)
agricultural productivity and and hydrological regimes
income opportunities related to Lake Victoria,
Improved ecological reduce the climate adaptation
monitoring of land resources. deficit that faces rural land
Improved use of land users, and reduce forest
resource monitoring in policy conversions.
and investment decisions.
Knowledge on SLM, land Estimates of global
degradation and climate risks environmental benefits
increasingly accessible to generated available; including
stakeholders and inform carbon accumulation rates
decision-making. SLM below and above ground,
Information system biomass change, and
institutionalized in aggregate land degradation
government planning. and climate risk threat
Strengthened capacity of reduction.
research and extension
services to jointly supply
communities with advisory
services on SLM practices
relevant for different AEZs.
Improved enabling
environment for up-scaling of
SLM resulting from:
(i) Increased awareness and
knowledge of stakeholders at
local, state, and federal level
142
related to the benefits of SLM
in terms of enhanced land
productivity and
sustainability
(ii) increasing adaptation
capacity to climate change,
(iii) National SLM
Committee capacitated to
improve investment
programming, lead advocacy
efforts, and policy and
stakeholder alignment
Improved mainstreaming of
SLM in policy dialogue and
investment planning.
Improved cross-sectoral
coordination and monitoring
on SLM implementation
Improved advocacy leads to
greater awareness of benefits
from SLM (including global
benefits)
Greater chances for greater
national budget and priority
given to upscaling SLM as a
pillar of national agricultural
development
Increment 7,200,000
3. Baseline 34,000,000 Increased capacity of No global environmental
Agricultural NAADS to deliver advisory benefits.
Advisory services to farmer groups.
Services Increased agricultural
productivity and income
opportunities for smallholder
farmer groups from improved
market access, technologies,
post-production, etc.
Strengthened sector-specific
technical skills of the
extension services to perform
feasibility work and provide
technical support for
investments in agricultural
technology
Increased empowerment of
smallholders as a result of
improved access to advisory
services.
With GEF 34,000,000 Note: some spillover national Note: some spillover global
Alternative (There is benefits from Component 2 benefits from Component 2
significant SLM included in national SLM increasingly adopted by
influence baseline benefits above. farmer groups, leading to the
from GEF Improved availability of global benefits listed in
investment in advisory services for SLM Component 2.
component 2) technologies in response to
143
demand by farmer groups and
improved availability of
knowledge on SLM.
SLM mainstreamed into
NAADS operations at all
levels.
4. Baseline N/A Enterprises and value chains No global environmental
Agribusiness developed with farmer group benefits.
Services and participation
Market Productivity, production, and
Linkages income raised.
With GEF N/A Same as above.
Alternative
5. Project Baseline 10,000,000 Improved project No global environmental
Management management for project benefits.
and implementation, efficient
Monitoring70 administration of project
funds, and improved
coordination with
implementing institutions.
With GEF 10,000,000 Same as above. Note: See M&E work financed
Alternative (No direct by GEF in component 2.
additional Note: no GEF resources given
GEF toward project administration)
financing)
Total Baseline 117,900,000
With GEF 125,100,000
Alternative
Increment 7,200,000
70
No GEF financing for project management costs, which are fully financed by the GoU.
144
Annex 12: Safeguard Policy Issues
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
1. The adverse environmental impacts of ATAAS are expected to be limited, so it is rated at
a Category B project. Potential direct impacts on the environment are related mainly to civil
works undertaken through ATAAS, which include: the rehabilitation or construction of research
facilities (office buildings, staff housing, laboratories, workshops, access roads, piers, water
supply, drainage and sewerage, greenhouses, and waste incinerators, for example); the use of
pesticides and fertilizers; and the generation of laboratory and other waste. Potential indirect
impacts on the environment are related to agricultural intensification and the expansion of
agriculture to non-agricultural lands such as forests and wetlands. The proposed project therefore
triggers two safeguard policies: (i) Environmental Assessment (OP/BP 4.01) and (ii) Pest
Management (OP 4.09).
2. OP 4.01. To ensure compliance with the OP 4.01, an Environmental and Social
Management Framework (ESMF) has been prepared. Given that the precise scope and location
of ATAAS activities cannot be determined at present, the ESMF will ensure that environmental
due diligence is undertaken for ATAAS activities as they are proposed and implemented. The
ESMF provides step-by-step guidance for identifying potentially adverse impacts of specific
ATAAS activities, planning mitigation measures, and implementing and monitoring those
measures. Future ATAAS activities--for example, the construction and rehabilitation of research
facilities or projects funded through competitive research grants--will be screened and their
potential environmental and social impacts managed using the ESMF. Once plans and locations
for civil works at the selected research facilities are final, site-specific Environmental
Management Plans will be prepared. Should new sites be required to build facilities of
significant scope, it is likely that site-specific Environmental Impact Assessments will be
prepared.
3. The ESMF will also be used for screening infrastructure investments and subprojects to
ensure that they do not trigger other World Bank safeguard policies, such as Natural Habitats
(OP/BP 4.04), Indigenous People (OP/BP 4.10), Physical Cultural Resources (OP/BPO 4/10),
and Involuntary Resettlement (OP/BP 4.12). This screening will ensure that ATAAS does not
finance any activities that: (i) are located in critical natural habitats; (ii) are likely to lead to the
destruction of natural forests; (iii) are likely to harm indigenous people; (iv) involve physical
cultural resources; and/or (v) relocate people or limit their access to public or common assets,
thus affecting their livelihoods.
4. Strategic EA. To ensure that environmental and social issues are adequately studied and
managed, not only at the project but at the sector level, a Strategic Environmental and Social
Assessment of the sector will be prepared as one of the ATAAS activities. The Strategic
Environmental and Social Assessment will examine (i) the environmental and social implications
of the DSIP and (ii) current environmental and social issues in the agricultural sector and their
management.
5. OP 4.09. To ensure compliance with the OP 4.09, an Integrated Pest Management
Framework (IPMF) has been prepared as a part of the ESMF. The IPMF outlines the approach
ATAAS will follow to ensure safe handling, application, and disposal of pesticides. In addition,
the IPMF promotes the use of integrated pest management in the sector.
145
6. Disclosure and Consultations. The ESMF, including the IPMF, was cleared by the
National Environmental Management Authority and IDA and disclosed in Uganda and the World
Bank's InfoShop in January, 2010. The revised/final ESMF, with IPMP, was cleared by NEMA
and disclosed in both Uganda and InfoShop in April 2010. The proposed prevention and
mitigation measures together with their monitoring plans form an integral part of the project's
design and costs. Preparation of the ESMF was informed by consultation with key stakeholders.
The record of consultations is included in the ESMF.
7. Safeguards Capacity. To ensure that the capacity to implement the ESMF is fully
adequate, ATAAS implementers will be trained to use the ESMF early in the project
effectiveness period. Additional technical assistance will be provided as necessary during project
implementation for screening ATAAS activities or monitoring the implementation of mitigation
measures to ensure close adherence to the ESMF. It is important to note that the ATAAS
capacity development program for AASPs will support sound environmental management in
agriculture by integrating environmental management and compliance considerations into
AASPs' repertoire (for example, environmental regulations stipulating that wetlands and forests
be protected from agricultural encroachment and degradation). Finally, the project includes a
significant program to mainstream SLM practices and increase the resilience of farming systems
to climate variability and change.
8. The project will support improvements and rehabilitation of physical infrastructure at
several NARIs and ZARDIs and a small number of new civil works at three newly established
ZARDIs. Given that all civil works will be on land already proven to be owned by NARO, no
impact related to land acquisition is expected. Encroachers, if any are present, will be given
notice to leave or to harvest their crops before construction begins.
9. Funding and Financing Agreement. Funding for activities related to safeguards is
integrated in the ATAAS Financing Plan. Compliance with the ESMF is included in the
Financing Agreement. The funds for the Strategic Environmental and Social Assessment
(SESA) are provided in the NARO basket. The preparation of SESA would be outsourced under
the oversight of the MAAIF Headquarters and the NARO Secretariat. The preparation of this
safeguard document for the agriculture sector would need to commence early to ensure that it is
completed before the decision meeting for the proposed second track operation in support of the
MAAIF DSIP. The SESA will be the main safeguard document for the planned project and
would need to be disclosed prior to its decision meeting.
146
Annex 13: Project Preparation and Supervision
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
Planned Actual
PCN review 11/10/2009 11/06/2009
Initial PID to PIC 11/12/2009 11/09/2009
Initial ISDS to PIC 11/12/2009 11/24/2009
QER 03/01/2010 04/01/201
Appraisal 03/12/2010 04/15/2010
Negotiations 04/08/2010 05/11/2010
Board/RVP approval 05/25/2010
Planned date of effectiveness 09/30/2010
Planned date of mid-term review 06/30/2013
Planned closing date 06/30/2015
Key institutions responsible for preparation of the project:
Ministry of Agriculture, Animal Industry, and Fisheries (MAAIF) through National Agricultural
Research Organization (NARO), and National Agricultural Advisory Services (NAADS)
IDA staff and consultants who worked on the project included:
Name Title Unit
Madhur Gautam TTL, Lead Economist AFTAR
Sergiy Zorya Co-TTL, Economist AFTAR
Christine Cornelius Program Coordinator AFTAR
Nightingale Rukuba-Ngaiza Sr. Counsel LEGAF
Luis Schwarz Sr. Finance Officer CTRFC
Wilson Onyang Odwongo Sr. Rural Dev. Specialist AFTAR
Stephen Danyo NRM Specialist AFTEN
Sandra Sargent ICT Operations Officer CITPO
Glen Levine ICT Consultant CITPO
Jacob Kampen Agric. Research Consultant AFTAR
Hermann Pfeiffer Sr. Agricultural Officer FAO/TCIA
Lisa Paglieti Economist FAO/TCIA
David Gisselquist Seed Sector Consultant FAO/TCIA
Anis Wan Operations Officer EASSD
Moses Kibirige Sr. PSD Specialist AFTFE
Mathrew McMahon Agric. Services Consultant AFTAR
Vildan Verbeek-Demiraydin Sr. Economist AFTQK
Varun Kshirsagar Economist AFTAR
Jonathan Miller M&E Consultant AFTAR
Martin Fodor Sr. Environmental Specialist AFTEN
Mary Bitekerezo Sr. Social Dev. Specialist AFTCS
Howard Bariira Centenary Procurement Specialist AFTPC
Michael Okuny FM Specialist AFTFM
Barbara Magezi Ndamira Public Sector Specialist AFTPR
Valentine Namakula Governance Consultant AFTAR
Harriet Kiwanuka Team Assistant AFMUG
Hawanty Page Sr. Program Assistant AFTAR
147
Annex 14: Documents in the Project File
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
1. Project Concept Note
2. Project Information Data Sheet (concept stage)
3. Integrated Safeguard Data Sheet (concept stage)
4. Minutes of the PCN review meeting
5. Project Information Data Sheet (appraisal stage)
6. Integrated Safeguard Data Sheet (appraisal stage)
7. PPF Request package
8. Minutes of the QER and Minutes of the Decision Meeting
9. Environmental and Social Management Framework (ESMF), including the Integrated
Pest Management Framework (IPMF), April 2010
10. Detailed Economic and Financial analysis
11. Financial Management Capacity Assessment Report ­ NARO, March 2010
12. Financial Management Capacity Assessment Report ­ NAADS, April 2010
13. Procurement Capacity Assessment Report ­ NARO, February 2010
14. Procurement Capacity Assessment Report ­ NAADS, February 2010
15. NARO Project Implementation Plan
16. NAADS Project Implementation Plan
17. Project Procurement Plan ­ NARO, April 2010
18. Project Procurement Plan ­ NAADS, April 2010
19. National Agricultural Research Program (NARS) Document, March 2010
20. NAADS Core Document and four technical papers, April 2010
21. NARO-NAADS Partnership Framework, April 2010
22. Working Document 1: Key Findings of the NAADS Impact Evaluations
23. Working Document 2: Promoting Agribusiness in Uganda
24. Working Document 3: International Experience with Matching Grants
25. Working Document 4: Threats and Opportunities: Climate Change, Land
Degradation, and Livelihoods
26. Working Document 5: Sustainable Land Management Practices: Technical
Description
27. Working Document 6: Information and Communication Technology
28. Working Document 7: Strategy for Strengthening Social Inclusion and Gender
Mainstreaming
148
Annex 15: Statement of Loans and Credits
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
Difference between
expected and actual
Original Amount in US$ Millions disbursements
Project ID FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm. Rev'd
P092837 2010 UG: Transport Sector Development Project 0.00 190.00 0.00 0.00 0.00 191.01 0.00 0.00
P112334 2009 UG: Energy for Rural Transformation 0.00 75.00 0.00 0.00 0.00 74.89 5.90 0.00
APL2
P111633 2009 UG: SEC N-Uganda SAF (NUSAF2) 0.00 100.00 0.00 0.00 0.00 87.32 -15.30 0.00
(FY09)
P110803 2009 UG: Post-Primary Educ & Trg APL-1 0.00 150.00 0.00 0.00 0.00 152.19 0.00 0.00
(FY09)
P090867 2008 UG: Local Govt Mgt Svc Del Pjt (FY08) 0.00 55.00 0.00 0.00 0.00 39.36 17.92 0.00
P078382 2008 UG: Kampala Inst & Infrast Dev Prj (FY08) 0.00 33.60 0.00 0.00 0.00 30.33 22.86 0.00
P110207 2008 UG: Program for Control of Avian Influ 0.00 10.00 0.00 0.00 0.00 9.48 5.00 0.00
P069208 2007 UG: Power Sector Dev. Project (FY07) 0.00 300.00 0.00 0.00 0.00 91.03 34.88 0.00
P086513 2006 UG: Millennium Science Init (FY06) 0.00 30.00 0.00 0.00 0.00 17.28 0.44 0.00
P050440 2006 UG: Pub Serv Perform Enhance (FY06) 0.00 70.00 0.00 0.00 51.21 17.60 57.88 1.60
P074079 2005 UG: Road Dev APL 3 (FY05) 0.00 107.60 0.00 0.00 0.00 10.27 2.73 3.63
P083809 2005 UG: Priv Sec Competitiveness 2 0.00 70.00 0.00 0.00 0.00 47.43 42.55 0.00
P079925 2004 UG: Natl Re Dev TAL (FY04) 0.00 30.00 0.00 0.00 0.00 8.46 1.36 -0.09
P065437 2003 UG: PAMSU SIL (FY03) 0.00 27.00 0.00 0.00 0.00 0.03 -3.45 0.00
P073089 2001 UG: EMCBP SIL 2 (FY01) 0.00 37.00 0.00 0.00 0.00 14.33 -3.21 7.29
P070627 2001 Regional Trade Fac. ­ Uganda 0.00 20.00 0.00 0.00 0.00 8.78 5.62 0.00
P050439 2001 UG: Priv & Utility Sec Reform (FY01) 0.00 48.50 0.00 0.00 12.14 8.53 17.22 11.72
Total: 0.00 1,353.70 0.00 0.00 63.35 808.32 192.40 24.15
UGANDA
STATEMENT OF IFC's
Held and Disbursed Portfolio
In Millions of US Dollars
Committed Disbursed
IFC IFC
FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic.
1996 AEF Agro Mgmt 0.26 0.00 0.00 0.00 0.26 0.00 0.00 0.00
1992 AEF Clovergem 0.84 0.00 0.00 0.00 0.84 0.00 0.00 0.00
1999 AEF Gomba 0.45 0.00 0.00 0.00 0.45 0.00 0.00 0.00
1998 AEF White Nile 0.10 0.00 0.00 0.00 0.10 0.00 0.00 0.00
2005 DFCU 10.00 0.00 0.00 0.00 10.00 0.00 0.00 0.00
1998 Tilda Rice 0.48 0.00 0.00 0.00 0.48 0.00 0.00 0.00
2005 UMU 1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total portfolio: 13.13 0.00 0.00 0.00 12.13 0.00 0.00 0.00
149
Annex 16: Country at a Glance
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
150
151
Annex 17: Maps
UGANDA: Agricultural Technology and Agribusiness Advisory Services Project
152